Your Statutory Leave Entitlement in Malaysia: Annual, Sick, Hospitalisation & Public Holidays

Who the leave provisions cover

This is the single most misread part of the Act. Before 2023 the Employment Act only reached employees earning RM2,000 or less (plus certain manual and transport workers). The Employment (Amendment) Act 2022 removed that ceiling: the Act now applies to all employees with a contract of service, regardless of salary.

What survives is a much narrower carve-out. The First Schedule still disapplies the premium-pay provisions — the statutory overtime rates, rest-day rates, shift allowances and the extra pay for working on a public holiday — to employees whose wages exceed RM4,000 a month. Those are pay multipliers, not entitlements.

The distinction matters: annual leave, sick leave, hospitalisation leave and the right to eleven paid public holidays apply to everyone, including a manager on RM15,000. Only the premium rate for actually working on a public holiday is capped at RM4,000. If your contract gives you less than the statutory minimum leave, the contractual term is void to that extent and the statutory figure applies instead.

Annual leave — 8, 12 or 16 days by length of service

Section 60E ties paid annual leave to completed years of continuous service with the same employer:

How annual leave is pro-rated

If you have not completed twelve months of service in the year, the entitlement is proportionate to the months you did complete, with any fraction of a day rounded up to a full day.

Join on 1 April in your first year and you complete nine months by 31 December. On the 8-day band that is 8 × 9 ÷ 12 = 6 days for that year. Join on 16 May and complete seven months, and it is 8 × 7 ÷ 12 = 4.67, rounded to 5 days.

The same arithmetic runs in reverse when you resign mid-year, which is what determines your final payout. Note the entitlement steps up on the anniversary of your start date, not on 1 January — an employee who crosses two years of service in June moves from the 8-day band to the 12-day band from that point, and a well-run payroll pro-rates across the two bands rather than applying the lower one for the whole year.

Lapsing, forfeiture and carry-forward

• Leave that is not taken within twelve months of the year in which it accrued lapses. The Act creates no right to bank leave indefinitely, and employers may set an earlier internal cut-off or cap how many days carry over.
• If your employer directs you to take your leave and you refuse without reasonable excuse, you are deemed to have forfeited it — refusing to clear leave is not a route to a bigger payout.
• You also forfeit the year's annual leave if you are absent without leave and without reasonable excuse for more than 10% of the working days in that twelve-month period.
• Annual leave is in addition to rest days and paid public holidays; those are never counted as annual leave taken.
• If you fall sick during annual leave, or a gazetted public holiday falls inside it, that day is treated as sick leave or a holiday — it does not consume an annual leave day.

Sick leave — and the 60-day hospitalisation aggregate

Section 60F sets paid sick leave per calendar year, again by length of service. Where hospitalisation is necessary, the entitlement extends to 60 days in aggregate.

What the 60 days actually means

The 60 days is an aggregate ceiling on paid sick leave in a calendar year, not a separate pot stacked on top of your 14, 18 or 22 ordinary days. An employee with three years' service who uses all 18 ordinary sick days and is then hospitalised has 42 further paid days available, not 60. Read your contract: many employers spell this out, and some improve on it.

The Act says "where hospitalisation is necessary" — not "where the employee is admitted". The Industrial Court has accepted that a registered medical practitioner certifying that hospitalisation was necessary can trigger the extended entitlement even where a bed was unavailable or the employee was treated at home. In practice you need the certification to say so explicitly.

Two procedural traps cost employees this entitlement more often than any argument about the numbers. First, the medical certificate must come from a registered medical practitioner or dental surgeon — the employer's appointed panel doctor if there is one, otherwise any registered practitioner or a government medical officer. Second, you must inform your employer within 48 hours of the sick leave commencing; fail to and you are treated as absent without leave, which is a disciplinary matter regardless of how genuine the illness was.

Sick leave is paid at your ordinary rate of pay, and it is a right to be paid while absent — not a balance you own. Unused sick days are never paid out when you leave.

Public holidays — 11 paid days, 5 of them fixed

Section 60D entitles you to at least eleven gazetted public holidays a year at your ordinary rate of pay, of which five must be Workers' Day (1 May), the Birthday of the Yang di-Pertuan Agong, the Birthday of the Ruler of your state or Federal Territory Day, National Day (31 August) and Malaysia Day (16 September). Your employer chooses the remaining six, and must give notice of them at the start of the year. Any day declared a public holiday under section 8 of the Holidays Act 1951 — the ad hoc national declarations — is added on top of the eleven.

• If a gazetted public holiday falls on a rest day, the following working day becomes a paid holiday in its place.
• If it falls during sick leave or annual leave, you are entitled to another day off in substitution.
• You lose the day's holiday pay if you are absent without the employer's consent and without reasonable excuse on the working day immediately before or immediately after the holiday.
• Employers may substitute another day for a gazetted holiday by agreement, which is how companies run replacement holidays for state-specific dates.
• Working on a public holiday attracts two days' wages at the ordinary rate on top of the holiday pay — but that premium only applies to employees earning RM4,000 a month or less. See the overtime guide for the full multiplier table.

Maternity, paternity and rest days

• Maternity leave is 98 consecutive days, raised from 60 by the 2022 amendments. Maternity allowance is payable if you were employed at any time in the four months before confinement and for at least 90 days in the nine months before it; the old bar on employees with five or more surviving children was removed.
• Paternity leave is 7 consecutive days, for a married male employee with at least 12 months' service who notifies the employer, limited to five confinements in total.
• Rest days are separate again: at least one whole day per week, designated by the employer, and for shift workers a continuous period of 30 hours counts as a rest day.

What gets paid out when you resign

Unutilised annual leave must be paid in lieu on termination, at the ordinary rate of pay. For a monthly-rated employee the ordinary rate of pay is monthly wages ÷ 26 — the same divisor used for overtime, and not the number of days in the month.

Take an employee on RM3,900 a month with three years' service, so 12 days a year. They resign at the end of August with 5 days unused. Their ordinary rate of pay is RM3,900 ÷ 26 = RM150, so the payout is 5 × RM150 = RM750, added to the final salary.

Two things to check on that final payslip. Leave pay in lieu is wages, so EPF, SOCSO and EIS are deducted from it and it is taxable in the year received. And if you have taken more leave than you had accrued by your last day, the employer is entitled to recover the excess from your final pay — the same pro-rating formula runs both ways.

Important caveats

This is general information about the statutory minimum, not legal advice. The Employment Act 1955 sets a floor; your contract, collective agreement or company handbook may be more generous, and where it is, the better term applies. Sabah and Sarawak are governed by the Sabah Labour Ordinance and the Sarawak Labour Ordinance respectively, which follow similar structures but differ in detail. Domestic employees and certain categories are treated differently under the Act.

If you believe an entitlement has been denied, the Labour Department (Jabatan Tenaga Kerja) handles claims under the Act, and its offices will assess a complaint free of charge. For any dispute worth real money, get advice on your own contract before acting.

Use the calculator below to convert these entitlements into ringgit: enter your gross monthly salary to see your ordinary rate of pay basis and what a leave payout or a day of unpaid absence is actually worth after EPF, SOCSO, EIS and PCB.