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Jess Ong
30/04/2010 14:29:48
Re: Salary Earned More Than RM1500

Hi Mr Siew,

I noticed that one of companies' appointment letter with salary earned more than RM1500 with the appointment as follows:

"We are pleased............ we hereby.....with the terms and conditions hereunder:
- Basic salary
- commencement date
- Grade
- Allowance

You are required to observe the company's Terms and Conditions of Employment and other regulations of Employment Act."

My question is: it's this lawful? I mean by stating the... observe Employment Act" as this employee is not covered under Employment Act 1955 in ther appointment letter.

If yes, this means that they will entitle to all benefits stating in Employment Act 1955, including the rate of overtime pay for normal OT, rest day & public holiday OT? Am I right? Thanks!

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KL Siew
30/04/2010 15:29:10
Since the employer specifically mentioned the Employment Act, the provisions will become the terms and conditions. It will be difficult for them to deny it later on. However, that may or may not be a good deal. The EA provide only the basic minimum benefits and those benefits may not be good enough for higher paid or higher category employees.
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Jess Ong
30/04/2010 15:42:35
In this case, the employees will entitle to claim their OT based on their basic salary, this is an advantage to the employee right?

eg. Basic pay = RM3000
If OT 3 hours in week day, then

overtime entitlement will be RM3000 / 26 days / 8 hours x 1.5 times x 3hrs
= RM64.90.

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KL Siew
30/04/2010 16:23:16
Here can be a problem. If the employer failed to pay the overtime as mentioned by you, can the employees seek redress at the Labour Department? Will the Labour Department entertain the claim as the employees are not covered by the EA as "employee"? For such matters like overtime payment, maternity benefit, I think it is safer to get the employer to state them explicitly in the contract of service.
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03/05/2010 16:20:22
I think for those with RM1500 above, they are required to bring their case to Civil Court instead of Labour dept.
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