Guide to Overtime Calculations in Malaysia
Overtime in Malaysia is governed by the Employment Act 1955; the legal framework that regulates employment law in Malaysia. Employees in Malaysia are entitled to overtime compensation if they work more than 8 hours in a day, or 45 hours in a week.
This compensation is calculated at 1.5 times an employee’s regular hourly wage. Note that only employees earning less than RM 4,000 per month are allowed to receive overtime.
Employees can also earn different rates of overtime if they work on rest days or public holidays.
However, it is important to accurately calculate overtime compensation for employee payroll. Incorrect overtime payments can lead to fines up to RM 50,000.
To learn more about payroll compliance for overtime calculations in Malaysia, download the following poster!
