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Re-structure -- from "Contract of Employment" to Freelance Agreement

Jasmine_Ong
Member
Thu, 14 Jul 2016 11:32:41 AM  (Last updated: Fri, 22 Jul 2016 11:33:31 AM)

Hi Administrator/ Person-in-Charge

My company would like to re-structure company by change the employment contract from "Contract of Employment" to Freelancer services agreement (for sales department) whereby company will not pay EPF and SOCSO to employees under the new freelance agreement.  The current salary for all the employees are above RM 2000 thus may I know is this re-structure violate any rules under the Employment Act 1985?  The major reason for this re-structure is due to the sales's team is not bringing enough sales to the company and company is suffering losses from last year till now.

Secondly, may I know is it a must for the employee to sign the new contract with company after the re-structure (by end the "Contract of Employment" with company and re-sign the "Freelance Agreement" with company)?

Thank you very much.

KL Siew
Administrator
Thu, 14 Jul 2016 07:04:46 PM

To me the two types of contract are totally different. You can bring the two types of contract and show them to a lawyer. Get his legally opinion.

Jasmine_Ong
Member
Fri, 22 Jul 2016 11:33:31 AM
Originally posted by KL Siew on Thu, 14 Jul 2016 07:04:46 PM

To me the two types of contract are totally different. You can bring the two types of contract and show them to a lawyer. Get his legally opinion.

Thanks for your reply.

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