INTRODUCTION Chief Executive Officer (CEO), started from 2012



Do we as employees
know that there is a law in the world of work? Generally, the matter should be
known and is a term of employment contract where the rights and obligations of
employers and employees are to be complied with as stipulated in the Employment
Act 1955 in Malaysia.

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However, this
matter needs to be reviewed based on the shortage of current terms of
employment contract which consists of terms of a citizen and not a citizen. It
needs to be identified and evaluated to be complied with by the employer so
that today’s work environment needs to be fulfilled and that is the main
objective of this task.

Therefore, the
chosen organization is Tenaga Nasional Berhad (TNB). It was one of the
companies under the Governing Link Company (GLC) which began on September 1,
1990. Prior to that, on June 22, 1965, it was known as the National Electricity
Board of the States of Malaya (NEB). According to the TNB Annual Report 2017,
carried out is to supply electricity throughout Malaysia and it is the largest
electricity supply company in the country with a total of 9.2 customers in
Peninsular Malaysia, Sabah and Labuan. It is also known in the world market
especially in Europe to the Middle East in Indonesia, India, Saudi Arabia,
Turkey, Kuwait and the United Kingdom. A total of RM142 billion assets were
owned by TNB and it was controlled by Dato ‘Ir. Hj. Azman bin Mohd, who is also
the President and Chief Executive Officer (CEO), started from 2012 until now.
Business features are electricity to be generated, transmitted and distributed
throughout Malaysia while the portfolio of energy assets has been expanded to
the world market. In addition, cables and switchgears, project management
experts, maintenance and repairs of electrical equipment are services operated
by TNB subsidiaries such as Sabah Electricity, Intergrax Bhd and others. In
addition, TNB is also not left behind in education, an educational institution
established in 1976 namely the Sultan Ahmad Shah Training Institute (ILSAS) in
Kajang, Selangor. It is an educational institution for the Electricity
Guarantee (Chargeman) with the cooperation of the Energy Commission. After
that, it was upgraded to a university after several academic programs offered
to the Master of Science degree (University Tenaga Nasional (UNITEN) located at
Kajang and Bandar Muadzam Shah, Pahang and was set up on 23 August 1999. TNB’s
total number of employees is 35,000 which is 80 percent male and 20 percent
female. In addition, there are four types of occupations and the number of
employees namely the Top Management of 36 persons, Management of 296 persons,
Executive 5,321 persons and Non-Executive Employees of 29,347 persons.


Services and Contract Services for Services


Service Contract


Agreements made
between employers and employees on terms or terms determined by oral, written,
express or implied are known as Contract Services. It is stated in the
Employment Act 1955 where agreement is made when other workers’ recruitment
that has been approved by a person as a worker or services for employers have
been agreed upon by others as employees.

In addition,
important matters should be stated in this service contract such as job scope,
leave entitlement, salaries and so on. For example, the salary earned by a TNB
employee was agreed upon after the employer’s request was made.

Therefore, a
service contract is available through a letter of appointment when the job is
offered to the employee.

For information,
the terms and conditions of employment fail to be changed unless otherwise
agreed by the employee. Additionally, the service contract will be invalid or
invalid if any of the terms and conditions of employment are not satisfactory.
This is because it is a priority set out under the Employment Act 1955.
However, in order to avoid disputes over agreed terms and conditions, the
contract in writing is highly encouraged.


Contract for Service


No relationship
between employer and employee is known as a Contract for Service where an
individual is self-employed or free of charge including the fees received and
the services it provides, for example, a contractor or vendor. Therefore, the
best service needs to be given although it can be assisted by others for the
assignment. According to the terms of the Employment Act 1955, it is not a
worker. For example, Ali is a food shop operator on TNB premises.


Differences in Service Contracts and
Contract for Services


Agreements made
between employer and employee relationship are Contract Services where services
are rendered to employers and they are covered under the Employment Act 1955.
In this regard, employees are required to pay EPF and statutory benefits should
be paid by employers to employees under contract of service including benefits
medical, maternity leave, bonuses and more.

For self-employed
individuals and independent income such as the relationship between the
customer and the contractor is a Contract for Service and is insufficient and
there is no statutory benefit in the Employment Act 1955 as an employee.

Here are some
factors to consider in order for the Employment Contract to be easily
identified, namely:


a. Priority
Factors of issues such as workplaces and places need to be provided by whom?


b. Control

– how is the
salary of a worker paid and whose salary is paid?

-Workers are taken
and dismissed by the decision?


c. Economy is
considered where is your own employer or individual doing business?

– Advantages or
losses with whom to share?

-What profit is
earned and how income is calculated?




Referring to the
Employment Act 1955, for matters involving finances is the Terms of the
Pecuniary such as allowances, bonuses, wages, benefits of the spouse and ex
gratia pay granted by the employer to the employee.




Two Terms of the
Pecuniary are described as follows:

1. Period of salary


This is stated
under the Employment Act 1955 where wages are not allowed within a month or
allowed for less than a month as referred to S.18 (1) EA 1955.

For the matter
(S.2 AK 1955), it is stated that the salary received by the employee will be
paid and it is named as “Payroll Period”.

2. Payment of Salaries


Based on the
prescribed period, wage payments must be made by the employer.

Therefore, at
seven days after the period of salary expires, employees are to be paid
salaries by employers where all types of deductions have been made accordingly
(based on legal regulations) as set out under S.19 EA 1955. However, if the
director general is less satisfied due to the reasons given by the employer,
the delay in payment of wages is justified.

Payment of wages
shall be through the employee’s bank account and it refers to S. 25 (1).

However, payment
of wages can be made by check or cash upon request and this item is stated in
S.25 (A) 1.

No conditions are
allowed to be determined by the employer to control the employee’s salary
expense as referred to in Section 26.

As for Section 28,
it is stated that wages cannot be paid by employers in inappropriate locations
such as grocery stores, entertainment centers, liquors store and so on.

In the event of a
dispute between the employee and the employer in terms of salary or cash
payment to the employee, it may be investigated and decided by the director
general. In fact,

all wage arrears
may be claimed by an employee to an employer under the provisions under S. 69
EA 1955.


Pecuniary Terms


While vacation
leave, maternity leave, public holidays, annual leave and overtime work are
examples of Non- Pecuniary Terms where it does not relate to financial matters
as provided by EA 1955 (Part XII).

Whereas Two Non
Pecuniary Terms are:

1.Maternity Leave


Referring to
Section XI EA 1955, it is stated that all female workers are given the right
and the guarantee of maternity issues. Therefore, a period of not less than 60
consecutive days of maternity leave is eligible for female workers. Meanwhile,
starting from the 22nd week of pregnancy (refer to the term
“confinement” in S.2 EA 1955, maternity leave is eligible.

It is an offense
if the female employee is terminated during the maternity leave by the employer
unless the business is closed. It is clearly stated under EA 1955 (S. 37 (4).

According to EA
1955, the conditions set out for maternity leave are pre-pregnancy leave before
delivery within 30 days or after delivery of maternity after the following day
is not allowed. It is permissible if the confirmation is based on the
appointment of a medical officer made by the employer. Thus, before delivery of
labor within 14 days, maternity leave may be taken at any time.

2. Annual Leave


The following are
described in S. 60E (1) (a) – (c) namely:

a. If the employee
works for less than two years, leave entitlement is given for eight days

b. For services
from two to five years, leave entitlement is given for twelve days.

c. The service
works from five years or more, then leave entitlement is granted for sixteen

Paid annual leave
is eligible to be given to employees based on how many months the employee
works. This qualification is granted for employees who have not served enough
for a prolonged twelve months and upon termination of service in the same year.

Whereas, the
one-day vacation calculation is based on one holiday day divided by less than a
day or more.

If an employee
does not come to work without the employer’s approval and has no solid
reasoning that exceeds 10% of the working day within twelve months of the
employee’s employment, the denial of the employee’s right may be made.

Further provisions
are based on (S. 60E 1B), i.e. no annual leave calculations for eligible
employees are given maternity leave or sick leave as it is considered a
vacation on such entitlements.

As with reference
to (S. 60E 2A), paid annual leave is granted to employees in the service year
he is terminated. In fact, the recruitment of all accrued leave is allowed on
the month of the employee served the same year.

Before the annual
leave is taken by the employee and there is a termination of the contract by a
particular party, the pay shall be made pursuant to the annual leave
entitlement unless, except in the event of a dismissal as a result of a
misconduct i.e. referring to (S 60E 3A) after the investigation.

of Pecuniary and Non Pecuniary Terms


Evaluation of the
Pecuniary and Non- Pecuniary Terms is based on the terms of the contract of
employment used in TNB in ??accordance with the Act of Employment Act 1955.

Pecuniary Term


a. Pay period


At TNB’s company,
the Employment Act 1955 has been referred and used in the Human Resource
Management Circular No. 2 Year 2009 in which payment of wages to workers is not
allowed within a month or allowed for a period of less than a month as referred
to S.18 (1) EA 1955. For example, TNB’s employee salaries are paid within one
month on September 24, 2018 for the month’s salary September while October
salary is October 24, 2018.


b. Paycheck


Based on TNB’s
Human Resource Management Circular No. 2 Year 2009, not later than the seventh
day payment of wages and legal deductions should be made by the employer as
stated in the Employment Act 1955. For example, the salary paid by TNB to its
employees after several deductions is made as the Employees Provident Fund
(EPF) zakat and income tax and the Social Security Organization (SOCSO).

In addition, based
on the Employment Act 1955, S. 25 (1), the salaries of TNB employees are paid
through bank accounts that have been notified by employees such as Maybank or
CIMB Bank.

The temporary
payment method made by check for newly employed employees with TNB is the same
as stated under the Employment Act 1955 in S.25 (A) 1.

Pecuniary Term Evaluation


a. Maternity leave


The women’s
maternity leave entitlement of TNB is 60 consecutive days including breaks or
public holidays and public holidays such as references in Part XI EA 1955.

If TNB female
workers suffer from pre-pregnancy loss in the 22nd week, then sick leave should
be taken and not counted as maternity leave as stated in S.2 EA 1955.

Therefore, the
Head of Department must be informed of the expected delivery date by letter
certified by TNB panel doctor or government hospital or Registered Medical


b. Annual leave


Based on the 7th
TNB Collective Agreement and the Employment Act 1955, the Annual Leave provided
by TNB to its employees is based on approval depending on the interests of the
service. The annual leave is to ensure that the importance of personal matters
can be managed and adequate rest is essential so that the assignment can be
implemented more effectively.

Typically, TNB
employees are entitled to an annual leave of one year of service with TNB and
based on calendar year (January 1 to December 31).

For example,
eligible annual leave to TNB Executive employees is as follows: –

Executive Staff Service Period

Than 5 Years

Years And Over But Less Than 10 Years

Years and Over





For TNB employees
who want to retire, then all eligible annual leave should be spent.


amendments to the current Law


Some suggestions
are submitted for each term so that they can be revised based on current job
requirements: –

1. Period of pay is paid twice a


It is recommended
that the salary payable per month be twice. For information, it has long been
practiced by the private sector where wages are paid in the middle and end of
the month. For example, wages are paid on the 15th and 30th of the month. At
the end of the month, Employees Provident Fund (EPF) contributions, zakat and
income taxes and Social Security Organization (SOCSO) are some examples of
legitimate deductions to be made.

It is aimed at
prudent spending to be practiced especially with the current uncertain fuel
price hike and ahead of the festive seasons. One example of the festive season
is that before the Hari Raya Aidilfitri, then the employees are easy to manage
spending wisely and prudently based on the current pay period with the next pay
period. Additionally, it can prevent workers from drastically stop. For
example, a notice of one month that failed to be submitted and the worker
stopped suddenly may also be avoided.


2. Payroll through bank account needs
to be adjusted


Payroll through
bank account needs to be adjusted as current technology develops without check
or cash. For example, there are still payments by check for contract workers at
one of the local universities at this time.

It aims to save
time, convenience and safety. For example, payroll through bank account can be
checked directly, secured and time saved with monthly expenditure management
can be easily managed through an employee bank account.




3. Maternity Leave Period is


It is recommended
that maternity leave be increased from 60 days to 90 days as referring to
Budget 2018 and it is in conjunction with the recently announced Women Empowerment


It aims to make
the rest available to women after birth and the quality of work can be
improved. For example, a surgical procedure performed by a mother or some
postpartum health requires adequate rest. In fact, more time spent with family.
In addition, breastfeeding campaigns are strongly supported because mothers can
provide the best breastfeeding to the baby during the period. This is because
at present, the price of formula milk is very expensive and family expenditure
can also be reduced. Furthermore, many benefits can be obtained from
breastfeeding as baby antibodies become stronger and it is very good for baby’s
physical growth. This is because the nutrients are very complete in breast


4. Annual Leave Employees want to
retire are converted into cash


It is recommended
that eligible annual leave but cannot be spent on employees who want to retire
automatically can be converted into cash.

This is because
money is needed when employees are retiring, especially in the private sector.
It is indispensable for future use as the expenses are quite expensive at this
point. For example, cost is quite expensive to cover medical costs for
purchasing medicines, daily expenses and so on.


5. Annual leave raised


Amendments must be
made under the Employment Act 1955 S. 60E (1) (a) – (c): –


a. If an employee
works for less than two years, leave entitlement is granted for eight days
amended to sixteen days.

b. For services
from two to five years, leave entitlement is granted for twelve days to eighteen


c. Service works
from five years or more, then leave entitlement is given sixteen days to twenty


It aims to spend
time and family ties can be established. Quoting from Sinar Online News on 17
July 2015, it is stated that in this challenging era, workload is one of the
factors in which the emotions of our children and our parents are ignored
because children do not come to visit them. In addition, it can also be a good
therapy for the health of the body and the stability of the employee’s mind as
it rests enough to perform the task again.



As is well known,
the terms of employment are comprised of Pecuniary Terms involving finances
such as periods and salaries while Non Pecuniary Terms are non-financial
related such as maternity leave and annual leave where employers and employees
are required to comply. Consequently, valuations and proposals and strong
excuses have been granted for each term for improvement in the current
Employment Act 1955. This is to ensure that job requirements can be met for the
benefit of the present and future workers in the future.