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Malaysia is rapidly transforming under the Twelfth Malaysia Plan 2021-2025; realigning its labor market and developing future-ready talent. This is giving rise to a strong pipeline of hybrid Malaysian talent, who are generalists with key competencies across multiple skill sets. International companies also view Malaysian talent as having the qualities they require for industrial expansion, most notably in the tech and engineering sectors.
In-Demand Roles
Majority of local firms practice group-centeredness — the traditional value of cooperation amongst group members to maintain group harmony.
As a Muslim-majority country, a culture of modesty and gratitude is prevalent in Malaysia. This influences business attire as well as office norms. Employers should provide concessions when it comes to Friday prayers and Ramadan working hours.
Trust is a key factor in the Malaysian workplace. Personal relationships play a big role when it comes to interacting with others, often delving into questions about personal lives such as family.
In the Malaysian workplace, peace is valued over confrontation. Employees avoid direct conflict, so building strong relationships helps create a space for open, honest communication and conflict resolution.
Malaysia has a minimum wage of RM1,500 as of May 2022 across all states.
An employee's basic salary excludes overtime pay and other compensation.
Employees are entitled to overtime pay. The rate increases depending on the day:
Max 8 hours/day, 45 hours/week.
Employees receive 11 paid holidays yearly, including:
Employers can select 6 additional holidays from:
Annual Leave
Special Leaves
Medical Leave
Employers must pay monthly withholding tax to the Inland Revenue Board (LHDN) by the 15th of each month. The fiscal year is from January 1 to December 31.
| Annual Taxable Income (MYR) | Tax on First Amount (MYR) | Tax Rate on Excess (%) |
|---|---|---|
| 5,000 to 20,000 | 0 | 1% |
| 20,000 to 35,000 | 150 | 3% |
| 35,000 to 50,000 | 600 | 8% |
| 50,000 to 70,000 | 1,800 | 13% |
| 70,000 to 100,000 | 4,400 | 21% |
| 100,000 to 250,000 | 10,700 | 24% |
| 250,000 to 400,000 | 46,700 | 24.50% |
| 400,000 to 600,000 | 83,450 | 25% |
| 600,000 to 1M | 133,450 | 26% |
| 1M to 2M | 237,450 | 28% |
| Above 2M | 517,450 | 30% |
Non-Resident Tax Rate: 30% fixed.
Zakat, a religious obligation, is mandatory for Muslim employees. Employers may facilitate this deduction on their behalf.
Bonuses are non-fixed compensation, determined by the employer. They are typically paid quarterly or annually. Culturally, it is also common to provide employees with a "13th month salary" as a year-end bonus.
Unlike some other Southeast Asian countries, Malaysia does not have a legal requirement for a 13th month salary. However, many employers choose to offer this benefit as part of their compensation package to attract and retain talent.
Termination with Notice
Notice Period
