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Wages deduction

Tue, 30 Mar 2010 09:57:19 PM  (Last updated: Wed, 31 Mar 2010 04:53:23 PM)


I would like to seek for advice about the wages deduction. My notice period is 2 months and the new company is willing to do a buy-out of one month. The current company agreed on the early release. The HR of the current company told me that I have to serve for one month and the buy-out amount will be deducted from there. Can the company do this without my consent? Is this lawful in Malaysia?

Below is part of the clauses in my contract.

... If the Company terminated the employment and decides to relieve you before the completion of the notice period, the 'Basic' component of the salary for the balance notice period would be paid to you. If at your request, the Company agrees to relieve you before serving the full notice period, you will be liable to pay the Company the 'Basic' component of the salary for the balance notice period. However, please note that accepting any such early relieving would be entirely at the discretion of the Company....

Please help!


KL Siew
Wed, 31 Mar 2010 08:40:17 AM

It looks like your current company may be thinking that deducting your salary is a easier way instead of corresponding with your new company. What you can do is to get a reimbursement of the amount deducted, from your new employer since they are willing to buy you out.

Wed, 31 Mar 2010 10:55:14 AM

Hi Siew,

Thanks for your quick response.

I talked to the new company and they are Ok with the reimbursement of the amount deducted as long as I can provide them either the payslip or document to indicate the buy-out amount.

The issue I have now is that, I could get nothing back from the one month and I am not certain what the payslip will show with zero figure since the one month work is completely offset the one month early release? I might not even get a payslip to indicate the deduction.

I talked to my current HR and they are not cooperative such as to provide me the details how the buy-out amount will be deducted from my salary, the impact of it to my EPFs, bonus and monthly allowances and to produce a document to indicate the buy-out amount. 

If the wages deduction is unlawful in Malaysia, I would like to communicate this to the HR and hopefully with this information, they will allow me to make a seperate payment for the buy-out instead of deduct it from the salary.

Hope to hear from you soon.

Thanks again,

KL Siew
Wed, 31 Mar 2010 04:38:20 PM

Things are always difficult when people are not willing to cooperate. Why not tell them not to make any deduction from your salary but ask them to work out the amount of indemnity to be paid and you will be willing to pay them in a separate cheque? The acknowledgment of the cheque may then be used to get the reimbursement from the new employer. If the matter still cannot be settled, I think you may have to consult the Industrial Relations Department whether they can be of any help.

Wed, 31 Mar 2010 04:53:22 PM

Many thanks for your valuable advice. Very likely I'll need to go to the Industrial Relations Department.

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