MALAYSIAN EMPLOYERS FEDERATION

HEAD OFFICE: 3A06 – 3A07, Block A, Pusat Dagangan Phileo Damansara II, No. 15, Jalan 16/11, Seksyen 16, 46350 Petaling Jaya, Selangor, Malaysia
www.mef.org.my Tel: 603-7955 7778 Fax: 603-7955 6808/7955 9008 E-mail: mef-hq@mef.org.my

Circular No: AG 15/2022

1 August 2022

To: ALL MEMBERS

Reduction of Maximum Working Hours from 48 Hours per week to

45 hours under Employment (Amendment) Act 2022
It has been widely reported that the Employment (Amendment) Act 2022
(“Amendment Act”), which amends certain provisions of the Employment Act
1955 (“EA 1955”), will come into effect on 1st September 2022.

2. Further to MEF Circular AG14/2022 dated 28 July 2022, this Circular

addresses the amendments to the EA 1955 on the reduction of the maximum
working hours per week from 48 hours to 45 hours, as guidance for employers
to make decision on whether to review and/or rearrange their respective
working hours to comply with the maximum of 45 hours per week.

Summary of Reduction of Maximum Working Hours per week to 45 hours

3. The Amendment Act 2022 reduces the maximum working hours per
week to 45 hours, for all employees under the scope of EA 1955 irrespective of
whether they are non-shift employees or shift employees.

A) Non-Shift employees
4. Aside from reducing the maximum working hours per week to 45 hours,
the other existing provisions on working hours under section 60A(1) of EA 1955
remain status quo. Members are reminded that, subject to certain provisos, an
employee shall not be required to work: -
(a) more than 5 consecutive hours without a period of leisure of at
least 30 minutes;
(b) more than 8 hours in one day;
(c) in excess of a spread over period of 10 hours in one day.
NORTHERN REGION – GF-12, Kompleks Sempilai, Jalan Sempilai, 13700 Seberang Jaya, Penang | Tel: 604 – 398 8980 / 398 7068 | E-mail: mefpg@mef.org.my
SOUTHERN REGION – No. 17A & 17B Jalan Cantik 6, Taman Pelangi Indah, 81800 Ulu Tiram, Johor | Tel: 607 – 862 4776 | Fax: 607 – 862 4773 | E-mail: mefjb@mef.org.my
EAST COAST REGION – B-8 & B-10, First Floor, Jalan Haji Ahmad 3, Sri Pahang Business Centre 25300 Kuantan, Pahang Darul Makmur | Tel: 609 – 512 4373 | Fax: 609 – 512 4251 | E-mail: mefktn@mef.org.my
PERAK OFFICE – A-1-3, 1st Floor, Wisma MFCB, No.1, Persiaran Greentown 2, Green Town Business Centre, 30450 Ipoh, Perak | Tel: 605 – 255 7778 / 255 9778 | Fax: 605 – 255 2778 | E-mail: mefip@mef.org.my
SARAWAK OFFICE – L3-03 DUBS Commercial Centre, Lot 376, Section 54, KTLD, Jalan Petanak, 93100 Kuching, Sarawak | Tel: 6082 – 247 027 | Fax: 6082 – 247 028 | E-mail: mefkch@mef.org.my
SABAH OFFICE – Lot No 1, Block A, 3rd Floor, Damai Point, Luyang, 88300 Kota Kinabalu, Sabah | Tel: 6088 – 210 579 | Fax: 6088 – 204 979 | E-mail: mefkk@mef.org.my
5. Members are further reminded that pursuant to section 60A(7) of the
EA 1955, the maximum number of hours of work for non-shift employees is 12
hours a day. The limit of 8 hours per day is for normal working hours, and the
12-hour limit will be inclusive of the overtime hours.

6. It is also important to note that overtime is defined as the number of

hours of work carried out in excess of the normal hours of work per day. The
existing overtime limit is 104 hours per month in the aggregate. For the
purposes of determining the overtime limit, work done on any rest day or public
holiday, or any day substituted for a public holiday is not taken into account.

7. Proviso (iii) to section 60A(1) states that where, by agreement under the
employment contract, the number of hours of work in one or more days is less
than 8 hours, the limit of 8 hours may be extended to a maximum of 9 hours on
the remaining days, subject always to the maximum limit of 45 hours per week
(note- emphasis provided to indicate the amendment to 45 hours per week).

B) Shift Employees
8. Members are reminded that “shift work” is defined as “…work which by
reason of its nature requires to be carried on continuously or continually, as the
case may be, by two or more shifts.”

9. Aside from the reduction of the maximum working hours per week to 45
hours, the other existing provisions in the EA 1955 that governs shift work
remain status quo. Members are reminded that employees engaged in shift
work may be required to work for more than 8 hours per day, subject to the
requirement in paragraph 4 (a) above, or more than 45 hours per week (note-
emphasis provided to indicate the amendment to 45 hours per week), provided
that the average number of hours worked over 3 weeks does not exceed 45
hours per week (note- emphasis provided to indicate the amendment to 45
hours per week).

C) Scenarios for Non-Shift Employees – MEF’s Commentary

10. Paragraphs 4 to 7 above are referred. Whilst MEF is aware that
companies may have different working hours arrangements, the scenarios
below are examples relating to an average company: -

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(a) Companies Working on an 8 hours per day (Excluding Break), 5
days per week.
(i) This is within the requirements of EA 1955, because the
maximum 8 hours per day and correspondingly with total
hours of work per week of 40 hours is within the limit of
maximum working hours of 45 per week.
(ii) Overtime limit remains at the maximum 4 hours per day
on the working days.
(iii) Employees working in excess of the 8 hours on their
working days, and on their off day, i.e., the 6th day, will be
paid overtime, calculated at the prevailing rate of 1.5 times
the hourly rate. Employees working on a rest day / public
holiday will continue to be paid on the statutory rates
under the EA 1955.

(b) Companies working on 8 hours per day (Excluding Break), 6 days

per week
(i) Whilst the 8-hour limit is adhered to for 5 days in the week,
the Company can observe a further 5 hours on the 6th day,
to ensure compliance to the maximum 45 working hours
per week.
(ii) Overtime limit remains at the maximum 4 hours per day
on 5 working days.
(iii) Employees working in excess of the 8 hours on the 5
working days, and in excess of the 5 hours on the 6th day,
will need to be paid overtime, calculated at the statutory
rate of 1.5 times hourly rate. Employees working on a rest
day / public holiday will continue to be paid on the
statutory rates under the EA 1955.

(c) Companies working on a 9 Hours Per Day (Excluding Break) 5

Days per week
Reference is made to paragraph 7 above. The proviso states that
where, by agreement under the employment contract, the
number of hours of work in one or more days is less than 8 hours,

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 the limit of 8 hours may be extended to a maximum of 9 hours on
the remaining days, subject always to the maximum limit of 45
hours per week (note- emphasis provided to indicate the
amendment to 45 hours per week).

Assuming that a company works 9 hours per day, for 5 days per
week from Monday to Friday, employees working in excess of the
9 hours on their working days, and on their off day, i.e., the 6th
day, will have to be paid overtime, calculated at the prevailing
rate of 1.5 times the hourly rate. Employees working on a rest
day / public holiday will continue to be paid on the statutory rates
under the EA 1955.

D) Scenario for shift employees – MEF’s commentary

Paragraphs 8 and 9 above are referred to. As an illustration, it is possible for a
shift employee to work in the following manner: -
SHIFT ROSTER

Week 1 Week 2 Week 3

MONDAY 12 12 12
TUESDAY 12 12 3
WEDNESDAY 12 12 -
THURSDAY 12 12 -
FRIDAY 12 12 -
SATURDAY - - -
SUNDAY - - -
TOTAL 60 60 15

(i) Total working hours over 3 weeks: 60 hours + 60 hours + 15 hours

= 135 hours.
Average working hours per week: 135 hours / 3 weeks = 45 hours.

(ii) Referring to the table above and as a further explanation of

paragraph 9 above, although a shift worker’s hours of work is 12
hours, no overtime is payable.

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E) Impact of 45 hours per week on the Calculation of Overtime
11. There is no amendment to Section 60I on the formula for calculation of
overtime. The basis of overtime calculation is on the employee’s Ordinary Rate
of Pay (“ORP”). ORP means “wages” as defined in section 2 EA 1955, which an
employee is entitled to receive under the terms of his contract of service for
the normal hours for one day, but does not include any payment made under
an approved incentive payment scheme or any payment for overtime, or for
work done on a rest day or any gazetted public holiday granted by the employer
under the contract of service or any day substituted for the gazetted public
holiday.

12. The ORP for an employee employed on a monthly rate of pay is

calculated according to the following formula: -
Monthly rate of pay
26 days

13. The ORP for an employee employed on a weekly rate of pay is calculated
according to the following formula: -
Weekly rate of pay
6 days

14. In that regard, the overtime rates are to be distinguished from the sum
known as the “rate of pay” that is payable to employees who work on a rest day
/ public holiday. In the scenario where employees work on a rest day / public
holiday within the normal hours of work of the company, they will be paid an
additional and separate sum which constitutes the rate of pay. Additionally,
overtime at the statutory rates at the hourly rate of pay (HRP) will be payable if
the employee works beyond the normal hours of work. The term “Hourly Rate
of Pay” means the ORP divided by the normal hours of work.

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MEF’s Commentary
15. Members may need to adjust their working hours to ensure compliance
with the new amendments. This may include extending the lunch break, or
what is termed as “period of leisure” in the EA 1955 so that the normal hours
of work is 7.5 hours on six (6) working days a week.

16. Members will be liable to pay overtime if their working hours exceed 45
hours per week.

17. Members who have different working arrangements from the scenarios
stated in paragraph 10 above are encouraged to seek the clarification of MEF
to ensure compliance to the new amendments.

Thank you.

Datuk Hj Shamsuddin Bardan

Executive Director

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