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Employee Absenteeism

Updated: Aug 11

The absence of employees in the workplace detrimentally affects productivity and costs Malaysian companies more than RM6bn in yearly costs as surveyed by the Malaysian Employers Federation (MEF) in 2016.



This article deals with the general law in relation to employee absenteeism. If you have any specific cases in relation to absenteeism, please consult a specialist legal professional to obtain advice.


The absence of employees in the workplace detrimentally affects productivity and costs Malaysian companies more than RM6bn in yearly costs as surveyed by the Malaysian Employers Federation (MEF) in 2016. The relevant law that deals with absenteeism is found within section 15(2) of the Employment Act 1955, which provides that an employee is deemed to have breached their contract of service if they have been continuously absent from work for more than two consecutive working days without prior leave from their employer, unless there is reasonable excuse for such absence or there was an attempt to inform the employer before or at the earliest opportunity during the absence.


As amended by the incoming Employment (Amendment) Act 2022, the Employment Act 1955 applies to employees from 1 Jan 2023. Notwithstanding, employment contracts often contains clauses dealing with workplace absenteeism. The key identifying words of an absenteeism clause are often as follows: -

  • More than two consecutive working days

  • Without prior leave from his employer

  • Attempted to inform his employer

  • At the earliest opportunity during such absence


In the face of employee absenteeism, three common scenarios tend to arise, and an employer may consider the following course of conduct in each of the three scenarios.


When the absent employee returns to work


When the employee in question returns to work after being absent for more than two consecutive working days, it is advisable that the following course of conduct be adhered to before deeming the employee’s absenteeism within meaning of section 15(2) of the Employment Act 1955: -

  • Ensure that the key identifying words as stated above apply to the facts of the particular case of absenteeism;

  • Issue a show cause letter and wait for a reply from the concerned employee;

  • Review the reply from the concerned employee and determine if the reason(s) offered are reasonable and if the reason(s) is deemed unreasonable, then initiate the relevant punitive actions in accordance with breaking a contract of service.


Section 14(1) Employment Act 1955 provides the following lawful consequences to findings of misconduct: -


"On the grounds of misconduct, the employer may, after due inquiry, impose any of the following punishments:

a) Dismiss without notice the employee;

b) Downgrade the employee (This means a demotion to a lower position and it may entail a salary reduction appropriate to the new grade); or

c) Impose any lesser punishment as he deems fit and just and fit. "


Any lesser punishment may include salary reduction, deferment of increment, suspension without pay and written warning. Take note that if suspension without pay is imposed, the maximum period that is permitted is 2 weeks.


When absenteeism is habitual but does not amount to 2 consecutive days


When the employee in question is habitually absent yet such absenteeism does not amount to 2 consecutive days, the following course of conduct is recommended before deeming the employee’s absenteeism within meaning of section 15(2) of the Employment Act 1955: -


See course of conduct recommended at (1) above; and

– Issue a final warning.


When absent employee does not return to work


In the rare instance that the employee is absent for two consecutive working days and does not appear to return back to work, the following course of conduct is recommended before deeming the employee’s absenteeism within meaning of section 15(2) of the Employment Act 1955: -


See course of conduct recommended at (1) above; and

– If the employee offers no reasons for their absence then terminate the employee’s contract of service or mark the employee down for abandonment of contract.


Questions and Answers


Q: Why does the employer need to repeat the disciplinary process upon the employee being absent? Can’t the employer refer to the previous warning and just take immediate action on the absenteeism?


A: Section 20 of the Industrial Relations Act 1967 places the burden on the employer to show that the employee was fairly dismissed. The purpose is to prove to the court that there was just cause or excuse in dismissing and that the rules of natural justice were followed by providing the employee with the opportunity to explain his absence. Hence, the idea is that by repeating the disciplinary process, it further ensures that employers have the requisite evidence for a successful defence in the event the dismissed employee files a claim before the Industrial Court.


Q: How many times can the employer warn an absent employee before there can be a dismissal of the employee?


A: There is no fixed rule on the number of warnings to be given. Rather, case law seems to suggest that if the absenteeism is habitual and repeated, then it warrants dismissal. A one-off incident would not warrant dismissal. As always, each case may turn on its own particular facts and circumstances.


Q: Can an employer issue an immediate warning to an employee after exhibiting absenteeism.


A: Employers are discouraged from giving immediate warnings to employees after exhibiting absenteeism. This is akin to punishing first without giving the employee the opportunity to explain his actions. Courts tend not to view immediate warnings positively.


 

Legal Disclaimer


We trust that you have gained some information from this article. If you have any specific questions related to this article, please contact us at askdonny@dwc.com.my.


This article is posted for general information purposes only and should not be construed as legal advice. Facts and circumstances differ from case-to-case. Please consult your lawyer for specific legal advice and action to be taken.

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