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Here’s What You Can Do When Your Employer Does Not Pay You On Time

Not getting your paycheck on time is frustrating, infuriating, disappointing, and let’s not forget illegal. Remember that you’re not supposed to grin and bear it even if you love your job. But, let’s face it, the passion for your work doesn’t pay for your food.

You’re already stressed enough; you don’t need to add more to your plate. So, of course, you want to take charge and fend for yourself.

If you don’t know where to start, read the article below. We’ll discuss some of the most frequent scenarios when employers won’t pay your salary. We’ll also tell you how to get out of this mess by using the best weapon available: the Employment Law.

Deciphering the Legal Lingo

Before getting to the possible scenarios you can face, here are some terms you need to know:

  • The Labour Court has jurisdiction over getting your salary back, or your benefits, aka termination salary or benefits, overtime pay, etc.
  • The Industrial Court deals with disputes between you and your employer that concern your rights and obligations. The majority of cases brought up in front of the Industrial Court regard unjustly dismissals.
  • Manual Labor is physical work such as construction work, cooking, dishwashing, and so forth.
  • Non-manual labour is brain work such as writing, computing, programming, etc.

Scenario 1: My Employer Never Pays Me On Time

Do a quick search for the Employment Act 1955. Under Section 19(1), you’ll find that your employer has the obligation to pay you “not later than the seventh day after the last day of any wage period.” 

So, if the last day of your wage period is the 23rd, you can’t be paid later than the 30th that month. The only time when that can happen is when you give your direct consent to your employer.

If you don’t give your consent, you’re in a legal disagreement with your employer. The first step is to check with HR or your employer directly and see if you can reach an understanding that benefits you both.

Otherwise, you can take legal action following the steps below:

  1. Write a letter of complaint, grab your ID and employment contract, and go to your local Labour Department Office. You can also e-mail or call them, but your complaint may not be processed as efficiently if you do that.
  2. Wait until the office investigates your matter.
  3. The Labour Department will get in touch with your employer. They may agree they’ve made a mistake and pay your salary. In this case, you’ll withdraw your complaint.
  4. Another possibility is that your employer says you’re wrong. In this case. The Labour officer assigned to your case will set a hearing date.
  5. Choose your legal representative. You may want a lawyer, someone from your trade union, or someone from the Malaysian Trades Union Congress. You can also represent yourself.
  6. After the hearing, you’ll get a formal decision from the Presiding Officer.
  7. If you or your employer aren’t happy with this decision, you have 14 days to appeal to the High Court.
  8. Best case scenario, the judge decides in your favour, and you get your money.
  9. Worst case scenario, your employer doesn’t agree to pay, but he also doesn’t appeal. In this case, the Labour Office must enforce the official order so that you can get your money back.

This whole process seems very tedious and it can discourage you. A lot of people like you give up just because of how much bureaucracy is involved. However, if you let your employer get away too many times with delaying your paycheck, you’ll never get it on time.

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Scenario 2: I Quit My Job And I Still Have Money To Receive

Let’s get back to the Employment Act 1955. This time, we’re at Section 20. Read it carefully. You’ll find out that your employer has to pay everything they owe by the last day of your contract. 

Of course, this section refers to employment contracts that end following the legal procedure, with the whole notice period shebang. But still, keep in mind, you’re not supposed to be waiting for months until your wages are paid.

If your employer refuses to pay, file a claim under Section 69 of the Employment Act 1955. Contact your local Labour Department office following the steps included above.

Scenario 3: I Quit My Job With No Notice. Am I Entitled to My Salary?

Now we’re onto section 21 of the Employment Act 1955. This reads that:

“Where an employee terminates his contract of service with an employer without notice in accordance with section 13 (1) or (2) or section 14 (3), the wages, less any deductions which the employer is entitled to make under section 24, earned by such employee up to and including the day immediately preceding the day on which the termination of the contract of service takes effect shall be paid by the employer to the employee not later than the third day after the day on which the contract of service is so terminated.”

That means:

  • Your employer still has to pay your wages within three days after your contract has ended.
  • Your employer can make some deductions, such as overpayment of wages, indemnity, recovery of advances of wages, and a few others you can read under Section 24.

If you notice your employer doesn’t follow the law, contact your local Department of Labour with a claim under Section 69 of the Employment Act 1955.

Your employer is also allowed to make a claim to get the amount you owe them in place of the notice you didn’t send.

The Labour Office will then arrange a hearing and they’ll notify you through an official letter. You will then attend this hearing and settle the claims you made.

Scenario 4: I’ve Been Laid Off Without Notice. When Can I Expect My Money?

According to Section 21(1) of the Employment Act 1955, your employer is obligated to pay your salary on the same day when he terminates your contract.

Of course, they can still apply for the deductions you can read about in Section 24.

If you notice any illegal or suspicious activity, you already know what to do: contact your local Labour Office.

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Scenario 5: What Money Am I Entitled To If My Employer’s Company Went Bankrupt?

This is another frequent scenario because many companies in Malaysia may go bankrupt or insolvent. In this case, the business is closed, and all the employees’ contracts are ended. This situation is not the same as “retrenchment” where some people get to keep their jobs.

So, here’s what’s happening in this case:

  1. Your employer must notify the Labour Department that they’re closing their company or that they’re retrenching some of their employees.
  2. Your employer must send the retrenchment form to the Labour Office. If they don’t do that, they will receive a substantial fine.

Remember that you’re covered by the Employment Regulations 1980 if:

  • Your salary is less than RM 2,000/ month.
  • Your salary is more than RM 2,000/ month but you’re doing manual labour.
  • You’ve been under a continuous contract of service for at least 12 months.

If your contract has been terminated, you can expect these benefits:

  • 10 days wages for every year of employment if you’ve worked at the company for less than 2 years.
  • 15 days wages for every year of employment if you’ve worked at the company between 2 to 5 years.
  • 20 days wages for every year of employment if you’ve worked at the company for more than 5 years.

Your employer must pay you these wages within 7 days. If they don’t to that, they’re guilty of an offence. In this case, you already know who to call. (Psst! It’s the Labour Department.)

Scenario 6: My Monthly Salary is Over RM 2,000. What Am I Entitled To?

Check the Employment Act 1955… oh, wait. This time it’s the Industrial Relations Act 1967. But it doesn’t hurt to read the entire Employment Act, either.

So. Head on to Section 2 of the Industrial Relations Act, page 13. Here you can find a definition of the term “workman,” which means anyone who’s “employed by an employer under a contract of employment.

Take a moment here to appreciate the beauty of that circular definition.

But this definition is more than just funny. It’s also interesting because it doesn’t base the meaning of the word employee on your salary and occupation as the Employment Act does. It also calls you a “workman” instead.

So, if you and your employer can’t agree, contact the Industrial Relations Department and submit your claim with them!

In Conclusion

You may not understand a lot of the legal mumbo-jumbo, but you can still fine-tune your BS radar. If something doesn’t feel right, open your laptop and start reading the law.

Don’t count too much on your employer’s goodwill. Sure, you can talk to them first, but if they postpone things for too long, contact your local Labour Department.

And remember, the longer you wait, the harder it will be to get what’s yours.

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