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10/10/2009 12:52:32
Re: Salary on Company Closing Down

Hi KL,
Currently my monthly salary is RM2000 + RM200 allowance per month and have worked with my company for 6 years now. By the end of Nov'09, my company will be closing down and will be paying a lay-off pay with a 20 days for every 1 year of service. They are calculating the pay per day by dividing the salary per month with 30 days, is this correct? Shouldn't it be 26 working days instead of 30 days? Staff will lose out more if based on 30 days in the calculation of lay-off pay. Which section of the labour law can be referred to for this calculation due to company closing down? Thank you in advance for your advice.
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KL Siew
10/10/2009 13:10:50
According to the Employment(Termination and Layoff Benefits)Regulations, it is total salary during the 12 months divided by 365. It is not to be divided by 26. For your case, 30 is not bad especially when you are not covered by the Employment Act. You can read about the Regulations at
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10/10/2009 19:08:05
I don't know Jojo is working with my wife same company of which is also closing down end of Nov 09. Is the calculation of the compensation paid includes fixed monthly "allowance" which an employee received ?

Using a total salary for 12 months and then divided with 365 days is just almost the same as using monthly salary divided with 30 days. So, KL Siew, what you mean is's sti
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KL Siew
10/10/2009 20:22:06
Fixed allowance should be included in the calculation.
Well, 30 is slightly better as a denominator.
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