Work out the retrenchment or termination benefit you're owed, your minimum notice and how much of the payout is tax-free.
Statutory termination benefit
RM 5,192.31
15 days' pay a year × 3.00 years at RM 115.38 a day
Statutory termination benefit: RM 5,192.31
This is the minimum the law requires when you're retrenched or laid off. It isn't owed if you resign or are dismissed for misconduct, and your contract can give more. Compensation for losing your job is tax-free up to RM10,000 for each completed year with the employer; the rest is taxed with your income.
RM2,600, 1 year 6 months
10 days' pay × 1.5 years at RM100 a day (RM2,600 ÷ 26).
RM1,500
RM3,900, 6 years
20 days' pay × 6 years at RM150 a day. All of it tax-free.
RM18,000
How the figures above are worked out — the rules, rates and reasoning behind every line.
If your job ends through retrenchment, redundancy or a lay-off, the Employment (Termination and Lay-Off Benefits) Regulations 1980 set a minimum payout once you've worked 12 months continuously. It isn't owed if you resign or are dismissed for misconduct.
The minimum is guaranteed to employees earning up to RM4,000 a month and to manual workers. Many employers pay more, so check your contract and any separation scheme.
You get 10 days' pay for every year of service if you've worked under 2 years, 15 days if 2 to under 5 years, and 20 days if 5 years or more. The rate applies to your whole service, and part years are counted to the nearest month.
A day's pay is your monthly salary ÷ 26. The benefit must be paid within 7 days of your last day.
Unless your contract says otherwise, the minimum notice is 4 weeks under 2 years of service, 6 weeks for 2 to under 5 years and 8 weeks after that. Pay in lieu of notice counts as compensation.
Compensation for losing your job is tax-free up to RM10,000 for each completed year with the same employer. The higher RM20,000 limit applied only to 2020 and 2021.
At least 10, 15 or 20 days' pay per year of service, depending on whether you've worked under 2 years, 2 to 5 years, or 5 years or more. A day's pay is your monthly salary ÷ 26.
Up to RM10,000 for each completed year of service is tax-free. Anything above that is added to your employment income for the year.
No. The statutory benefit is for retrenchment, redundancy and lay-offs. If you resign, you only get your salary up to your last day and any unused leave your contract pays out.
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