When you hire new employees in Malaysia as an employer, you won’t know if the claims they make in their applications and interviews are true until you try them out on the job. Even if they are, this doesn’t ensure that they’ll do well with the specific tasks their positions require or that they’ll match well with their teammates and your company’s culture.

Similarly, even if employees have researched a company well, they have no guarantees that the working conditions and culture that they’ll encounter will be a good fit for them. Probation periods can help both sides assess their situations.

Let’s look at the specific conditions and regulations that define probation periods in Malaysia.

Definition of a Probation Period in Malaysia

In some countries, the definition of a probation period is very strict and highly regulated. In Malaysia, however, probation periods are generally defined by employers through employment contracts instead.

In general, though, a probation period is understood to start at the beginning of a worker’s employment and continue for a reasonable length that’s enough for both parties to assess their situation.

During this time, employers watch their new employees carefully, checking to see if they have the capacity to do their jobs well and the ability to adapt to the company’s culture. Employees, for their part, take this time to judge how well they’ll fit in and enjoy their roles. They also assess whether the employer’s promised working conditions are accurately provided.

Lengths of Probationary Periods in Malaysia

In many countries, either the minimum length of probation periods, the maximum length, or both are mandated by federal law. In Malaysia, however, the Employment Act of 1955 makes no such stipulations, instead leaving the lengths of probation periods up to the discretion of employers.

It is required, however, that the length of the probationary period, if there is one, is stated in an employee’s contract. This must also include the possibility and length of any extensions if added as a possibility.

Therefore, probationary periods in Malaysia can be of any duration. On average, however, they last three months for most employees, six months for managerial positions, and up to 12 months for executives. Probationary workers typically remain on probation until they receive a formal confirmation of their continued employment or a termination.

Legal Considerations of Probation Periods in Malaysia

Probationary periods are not clearly mandated in Malaysia, but that doesn’t mean they’re not regulated. The rules laid out in the Employment Act apply to all employment in the country, including those on probation.

However, employers can define these test periods by stipulating their conditions in contracts, which employees then agree to when they sign them.

Pay and Working Conditions

Unlike in other countries, Malaysian workers cannot be paid less than their fully-employed counterparts, nor can they be made to work longer hours or perform more overtime. The Employment Act guarantees equal rights to all workers, which means that employers may not discriminate against probationary workers.

Malaysian workers work eight regular hours a day, and these hours must be worked within a 10-hour period. They may work overtime but are not allowed to exceed 48 hours of work per week, whether on probation or otherwise.

Termination and Notice

In many other countries, a probationary period is defined as a period within which a worker can be dismissed or resign without cause but this is not the case in Malaysia. Workers here can only be terminated for just causes and the burden of proof lies on the employer. Therefore, probationary workers are protected from no-cause termination as well as all other employees.

To terminate a contract, either party may, at any time, provide written notice to the other party. The minimum period required is four weeks’ notice for employees who have worked fewer than two years. This is true except in cases of wilful breach of the contract or gross misconduct by the employee, where no notice is required.

Unusually, either party may also offer pay in lieu of notice, which the other party has to accept. While it’s not unusual for employers to make payments in lieu, even employees can surrender their pay for four weeks instead of continuing to work for the employer.

Vacation / Holidays

Because of its multicultural society, some public holidays in Malaysia are compulsory while others are selected by employers. Five compulsory days are mandated and the employer has to provide another six days for a total of 11 paid holidays per year. All workers are entitled to these holidays including those on probation.

All workers are entitled to eight days of annual leave if they have provided less than two years of service to their employers. However, they are not entitled to their first eight days of annual leave until they have worked a minimum of one year for their employer. Therefore, in practice, probationary workers are not eligible for annual leave in Malaysia.

Benefits of Probation Periods in Malaysia

Probation periods can be advantageous not only for employers but also for new employees who are learning their jobs. The benefits they provide include:

  • For Employees

Extra attention and help with development provided by the employer.

Time to learn the company culture and adjust to the new position.

  • For Employers

Assessment period within which employees are motivated to prove their worth.

Period in which employees can be dismissed if their performance is lackluster.

Employers can set the conditions of their probationary periods.

Frequently Asked Questions

No, they’re not required by law so it’s up to the discretion of the employer whether to use them and how to define them in workers’ contracts.

Not in Malaysia. All workers, probationary or otherwise, can only be dismissed for just cause, and the employer has to prove their justifications.

A normal period lasts three months. However, some high-level positions may include 12-month-long probationary periods.