EMPLOYMENT LAW

THE EMPLOYMENT CONTRACT

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FORMATION OF
CONTRACT
An employer and an employee would enter
into a contract of service to signify the
employer and employee relationship.
It is an agreement whereby one person
agrees to employ the other as employee and
the other agrees to serve the employer as
employee.
This relationship includes an apprentice
contract.
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FORMATION OF
CONTRACT
An employment contract like any other
contract is based on the exchange of a
promised to work in return for wages
(Roger Rideout with Jaqualine Dyson,
Rideouts Principles of Labour Law, 4th
edition Sweet & Maxwell 1983 )

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FORMATION OF
CONTRACT
The process would involve the element of
bargaining, wherein both parties would
only come to an agreement after
exchanging promises. (section 7A of the
Employment Act 1955)

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FORMATION OF
CONTRACT
(ns)

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FORMATION OF
CONTRACT
Kilang Gula Felda Perlis Sdn. Bhd. V
Aman Shah bin Abdul Khalid [1998] 5
MLJ 700
(ns)

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Elements necessary to establish a

valid employment contract in law.

Employment contracts may be made

orally or in writing although it would
be a challenge
The terms and conditions in an
employment contract can be either
express of implied (Section 2 of the
Employment Act 1955)
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Express Terms in an Employment Contract

These are terms which varies according to the
employment contract. Some examples which are
standard terms would include:
a) Job title
b) Details of wages, bonuses
c) Working hours
d) Holidays and Medical Benefits
e) Probationary Periods
f) Mobility or transfer
g) Requirement to comply with company rules.
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Elements necessary to establish a

valid employment contract in law.
In order for there to be a valid employment
contract, the provisions under the Contracts Act
1950 shall be referred to. There are five
elements to be satisfied.
(a) (ns)
(b) (ns)
(c) (ns)
(d)
(e)
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TERMS IN AN EMPLOYMENT
CONTRACT
Pherdhaza Meneekji Framroz v Nowroji Rustamji
Mistri [1932] MLJ 96

(ns)

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TERMS IN AN EMPLOYMENT
CONTRACT
Any agreed changes to the conditions of
employment must be notified to the employee
within one month of the change taking place.
The notification must be by means of a written
statement.
If a copy of the statement is not left with the
employee the employer must preserve the
statement and ensure that the employee had
reasonable opportunities of reading it in the
course of employment.
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TERMS IN AN EMPLOYMENT
CONTRACT
The employer will have to provide a written statement of
the terms and conditions to his employee no later than 2
months after starting work. However there is no such
requirement if the service does not exceed one month.
A Contract of Service cannot in any way restrain an
employee from joining a registered Trade Union, or
participating in the activities of a registered Trade Union,
or participating in the activities of a registered Trade
Union or organizing the formation of a Trade Union.
Contract of Service must contain the period of notice for
the termination of the contract. Period of notice must be
same for both parties
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TERMS IN AN EMPLOYMENT
CONTRACT
If an employee is continuously absent from work for
more than TWO days:
a) Without prior leave from the employer
b) Unless he has reasonable excuse;
c) Has neither informed or attempted to inform his
employer prior to or at the earliest opportunity during the
absence, he shall be deemed to have broken his
Contract for Service (Section 15(2)) - but does not mean
automatic dismissal.

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TERMS IN AN EMPLOYMENT
CONTRACT
Amongst the terms required to be stated in an
employment contract is as follows:

Job title
Date of appointment
Salary
Allowance if any
Probationary period
Notice of Termination during probationary period and
after confirmation
Annual increment
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TERMS IN AN EMPLOYMENT
CONTRACT

Working hours
Public holidays
Rest days
Annual Leave
Sick leave/ maternity benefits
EPF / SOCSO
Confidentiality
Retirement and retirement age
Rules and regulations

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