SABAH LABOUR ORDINANCE

Labour Ordinance (Sabah Cap 67)
Amended as at 10.02.2005

(1) Introduction.
Labour Ordinance (Sabah Cap 67) was originally a state legislation.
It was declared a federal Legislation in 1965. (LN. 199/1965).

(2) Objectives.
(a) To ensure any agreement or employment contract between employer and employee
is valid in accordance with provisions of the legislation.

(b) To provide for terms and minimum employment conditions.
(c) To provide for minimum benefits for employees.
(d) To specify control procedures on employment of employees including
non- resident employees.
(e) To provide for procedures for recovery under the laws.

(3) Scope – Employer and Employee (Section 2)
This Ordinance covers both employer and manual employee without wage limitation.
In addition to that this Ordinance also covers non manual employee who receive
wages not exceeding RM 2,500 a month.


(4) Minimun benefits and important provisions

(4.1) Rest Day (Section 104B)
Every employee shall be allowed a rest day of one whole day a week.

(4.2) Method of Wage Payment on Rest Day.
An employee who works on a rest day is entitled to receive pay as below:-
(i) An employee employed on a daily or hourly rate of pay who work on a rest day
shall be paid for any period of work :
which does not exceed 4 hours of work, one day's wages at the ordinary rate
of pay; or which is more than 4 hours but does not exceed 8 hours of work ,
two day's wages at the ordinanry rate of pay.

(ii) An employee employed on a monthly rate of pay who work on a rest day shall
be paid for any period of work :which does not exceed 4 hours of work,
wages equivalent to half the ordinary rate of pay.
which is more than 4 hours but does not exceed 8 hours of work , one day's
wages at the ordinanry rate of pay.

(iii) 'Piece Rate' Payment Method :
An employee employed on piece rates who works on a rest day shall be
paid twice his ordinary rate per piece.

(iv) Overtime work on a rest day:
An employee shall be paid at a rate which is not less than two times
his hourly rate of pay.

(4.3) Prescribed Holidays (Section 103)
This Ordinance specify fourteen (14) paid prescribed holidays, four (4)
of which shall be:

1.the National Day;
2.the Birthday of the Yang di-Pertuan Agong;
3.the Birthday of the Yang di-Pertua Negeri Sabah; and
4.the Workers' Day.


(4.4) Method of Wage Payment on paid Prescribed Holidays (Section 103(6),(7) &8)
An employee shall be paid at a rate which is not less than three times
his hourly rate of pay.

(4.5) Annual Leave (Section 104D)
An employee who has completed twelve (12) months of continuous services is
entitled to paid annual leave of:-
(a) eight (8) days if he has been employed for a period of less than two (2)
years;

(b) twelve (12) days if he has been employed for a period of two (2) years
or more but less than five (5) years.
(c) sixteen (16) days if he has been employed for a period of five (5) years
or more.


(4.6) Sick Leave (Section 104E)
If an employee is sick but no hospitalisation is needed , he is entitled
to paid sick leave as follows:-
(a) fourteen (14) days if he has been employed for a period of less than two
(2) years;

(b) eighteen (18) days if he has been employed for a period of two (2) years
or more but less than five (5) years.
(c) twenty-two (22) days if he has been employed for a period of five (5)
years or more.

For those who requires hospitalisation , the amount of sick leave must
not exceed sixty (60) days a year.

(4.7) Maternity Benefit (Section 83)
A female employee is entitled of sixty (60) days of maternity leave. This leave can be taken 30 days before confinement or 60 days after confinement but must not exceed 30 days before confinement.

(4.8) Guranteed Week (Section 10 ).
An employer shall provide work suitable to the capacity of such employee for
not less than six (6) days in every week.

If the employer is unable or fails to provide such work on such number of days whereon the employee presents himself for work and is fit to work the employer shall nevertheless be bound to pay to the employee in respect of each of such days, wages, at not less than his ordinary rate of pay.


(4.9) Payment of wages (section 108).
The wages of an employee payable monthly shall be paid not later than seven (7)
days after the expiration of the period in respect of which they are due.

(4.10) The following deductions can be made from the wages of an employee.
(i) In accordance with the provisions of this Ordinance (subsection (1) section 113); or
(ii) In accordance with the provisions under subsection (2) of section 113, as
follows:
(a) deductions made at the request in writing by the employee in respect of the payment to any superannuation scheme or provident fund or thrift scheme lawfully established for the benefit of the employee and approved by the Director of Labour.
(b) deduction for any over-payment made during the immediately preceding three months by the employer to the employee by the employer's mistake; and
(c) deduction for the recovery of advances made in accordance with the provisions of section 102 (4).

(4.11) Prohibition of employment of children (Section 73)
(a) Children under age of 14 years shall not be employed in any specified place as below:
(i) mining sector, manufacturing, construction and transporting; and
(ii) Other place such as hotel, bar, restaurant, coffe shop, stall and office.
(b) Children under age of 12 years shall not be employed in any public entertainment that may harm his physical limb.

(4.12) Females not to be employed at night in industry. (Section 75)
No female shall be employed in any industrial undertaking such as mining,manufacturing, construction and transporting sectors during night from 10.00 pm to 6.00 am.


(4.13) Licence To Employ Non Residence Employee(section 118)
No person shall employ any non residence employee unless he has obtained a licence from the Director of Labour.

(4.12) Conclusion
(a) Other than to specify minimum benefits and protection to safeguard employee interests, the Llabour Ordinance (Sabah Cap 67) also specifies other provisions concerning conditions of employment and employer responsibilities, such as the maintenance a register of employees, house accomodation, sufficient supply of wholesome water and safety and health procedures at place of work.
(b) This Ordinance also specify procedures for recovery and penality due to employer's failure to comply the provisions regarding employees' right.

The Labour Ordinance (Sabah Cap.67) is available at Labour Department of Sabah at the price of RM25.00 per copy.