Pursuant to variations contained in the Work (Modification) Act 2022 (“the Modification Act”), which the governing administration has declared will occur into drive on 1 September 2022, workforce in Malaysia will be permitted to use to their employer for a Versatile Performing Arrangement (“FWA”). (For a much more comprehensive look at the adjustments less than the Amendment Act, read my earlier write-up: “Malaysia Employment Act amendments: 7 critical changes for companies to note”)
The introduction of FWAs below the Amendment Act is the very first time that FWAs have been formally recognised in Malaysia, and might be the 1st of numerous this sort of improvements — the governing administration has also shared that it is conducting research on the feasibility of a 4-working day doing the job week. Malaysian businesses can count on FWAs to grow to be much more commonplace in the in the vicinity of upcoming, and should start preparing now. Numerous of my purchasers are by now placing in place the vital versatile doing the job policies and other relevant files to not only make sure that they are not caught unprepared appear the 1st of September, but also to lay the foundations for the predicted adjustments in the next pair of a long time.
This post sets out the necessary factors that want to be lined in a Flexible Performing Policy, and also other advisable administrative/HR paperwork that companies need to strongly think about putting into put to easily accommodate FWAs.
What the Modification Act states
The basis of any interior documents and procedures must normally be what is in fact stated by the law. The FWA provisions in the Amendment Act are quite very simple. FWAs are furnished beneath the Amendment Act by the introduction of a new Element XIIC.
A new Area 60P states that an personnel could implement to an employer for a adaptable functioning arrangement to fluctuate the —
- several hours of function
- times of get the job done or
- spot of get the job done,
in relation to his employment.
The software system is established out in a new Area 60Q, which states that:
- The employee’s adaptable doing the job arrangement application will have to be in writing “and in the type and way as could be identified by the Director General” (for now, no way has been created concerning the form/way of the application).
- The employer need to approve or refuse the software inside 60 times from the day the application is received, and inform the employee in writing of the final decision.
- If the application is refused, the employer will have to state the ground of these types of refusal.
Hence, these are the vital lawful elements which need to be included by any inside insurance policies, and which will then be supplemented by articles to address numerous other sensible factors.
Vital factors that will need to be covered in a Adaptable Operating Coverage
Even soon after the Modification Act comes into power, it is not mandatory for companies to put in area a Adaptable Doing the job Policy. Having said that, introducing this kind of a coverage is a encouraged ideal practice, as undertaking so will present clarity for the management and personnel on what the employer’s placement is with regards to adaptable operating preparations. A very clear coverage also usually means there will be certainty for all events on how FWA purposes will be taken care of, and the Versatile Doing work Policy can be supplemented by an interior advice doc for HR/administration.
A Adaptable Working Plan can array in complexity and duration, from as uncomplicated as a few paragraphs on a single web site, to a significantly much more in depth policy. These are a several important problems which an powerful Flexible Doing work Policy really should tackle.
- The applicability, scope, and impact of the policy: It ought to be crystal clear from the outset which workforce the plan applies to. This is specially crucial for larger sized and multi-countrywide organisations which are likely to engage employees on a broad assortment of different work associations, including aspect-time workforce, temp personnel, secondees, and interns. The policy should really also state that while versatile doing the job preparations are recognised by the corporation, this does not signify that all programs for these kinds of preparations will be routinely authorised, or that workforce are contractually entitled to this kind of arrangements.
- The distinctive forms of adaptable functioning arrangements recognised by the business: Whilst the Modification Act generally permits personnel to use to differ the several hours, days, and area of do the job, an employer can provide extra information via an interior Versatile Performing Coverage. For example, the policy can outline precise preparations this kind of as short-term FWAs (where staff members can utilize for a FWA for a fixed time period of 3-6 months), or set change FWAs (where personnel can pick out both to do the job Monday-Wednesday or Wednesday-Friday). The gain of expressly placing out the distinctive forms of “company approved” FWAs is that it presents employees with obvious solutions to decide on from, allows the corporation to have some command around the sorts of FWA applications that will be submitted, and also sets anticipations that FWA programs exterior all those solutions are most likely to be rejected.
- Any pre-determined disorders or restrictions on adaptable working preparations: In addition to the distinct forms of FWAs as mentioned in the preceding segment, the coverage must also spell out the ailments or constraints on all those FWAs. For instance, the company might let an personnel to work remotely, but issue to a limitation that the place have to be within the similar state or in just a certain distance from the business, or that the personnel will have to be able to be present in the office environment for a monthly in-individual conference, or be in a position to go to meetings at customers’ workplaces. As an additional illustration, the organization might enable reduced doing the job hrs topic to a minimal range of hrs for every 7 days.
- Obligations in relation to confidentiality and wellbeing and protection: Two major problems that companies have when it comes to distant working are in relation to confidentiality, and well being and safety. The Versatile Performing Coverage need to established out the expectations and obligations on employees who are allowed to function remotely. The extent of these obligations will rely on the particular role, information and facts access level, nature of operate, as properly as field-specific necessities. Some employers may perhaps have to have substantial-stage protection in relation to documents or products to be in spot in the employee’s remote workspace. For health and fitness and protection, there should really be bare minimum needs in conditions of tools and the condition of the workspace (or the necessity to have a specified workspace), and some employers may perhaps want to mandate a well being and basic safety inspection, or a self-assessment checklist.
- Prospective adjustments to income, flexible doing the job allowances, or other benefits/remuneration: Depending on the varieties of FWAs specified in the policy (see earlier mentioned), it may be feasible to spell out particulars of changes to payment as a final result of an authorized FWA. Alternatively, the coverage can usually clarify that certain sorts of FWAs will come with adjustments to salary or gains — for example, a long term reduction in doing the job hrs will signify that an employee’s existing wage will be decreased, and maybe dependent on a fastened components. For multinational companies, an personnel who will be doing work in a different place less than a FWA may perhaps have to change to a distinct payroll locale and have his/her salary localised to his/her new locale centered on the company’s pay back scales in that jurisdiction. The policy can also include things like facts of any new allowances as a consequence of a FWA (for example, distant office environment gear and established-up allowance), or any present allowances that will no for a longer period be payable (for example, travelling or parking allowances).
- The company’s anticipations of personnel underneath a FWA: A extensive Flexible Doing the job Coverage need to also briefly established out the company’s expectatations of workers who have been authorized to operate beneath a FWA. This should contain the fundamental principles these kinds of as that workforce with decreased doing work hours are still envisioned to finish their key deliverables, attend all scheduled meetings, and continue to abide with the company’s procedures and procedures. It can also incorporate specifics wherever pertinent, these kinds of as getting required to go to a minimal variety of on-site meetings.
- The application approach: A vital element of any Versatile Working Coverage will be the software and acceptance course of action. In addition to the common applicability/scope part which was stated above, the section detailing the application method can set out other eligibility requirements. For instance, the enterprise could make it very clear that apps from personnel in their probationary time period, or who are presently going through a PIP, will not be approved. This segment can set out how programs can be submitted (preferably the corporation will also have a common FWA software type — see “Other proposed documents” below), and the approval procedure. Where related, the plan ought to also describe that any approval is conditional on the worker signing a Versatile Functioning Agreement or a supplemental document amending the relevant terms and disorders of their existing employment contract.
Other encouraged files
Apart from the Versatile Functioning Policy, it is also a advised finest follow for employers to have some or all of the next files in put:
- Workflow or guideline for HR/administration: This is a confidential document for HR/administration-degree staff only, and will established out steering on how to take care of apps. This will include location out the relevant people-in-demand for managing, choosing on, and responding to apps, as well as the essential issues and pertinent files. This is an critical advice doc to guarantee that the good approach is followed and the organization is not uncovered to any authorized chance.
- Template FWA software kind: This standardised application form will be referred to in the Adaptable Performing Policy, and workers will be strongly encouraged to use this sort when implementing for FWAs. Having a template in position will make sure that all the appropriate data is submitted as element of the application, and also will allow the company to remind staff of the terms and ailments that will be hooked up to thriving FWA programs. If the Adaptable Functioning Policy plainly sets out the distinct sorts of FWAs recognised by the enterprise (see “#2: The unique types of flexible working preparations recognised by the company” previously mentioned), then the software variety can include box-tick solutions (for illustration, the worker can apply for “FWA 4: Improve of days of perform to Wednesday to Friday”).
- Template approval or rejection letters: Again, getting this standardised document in put will make it a lot easier for HR/administration and guarantee that the firm is not uncovered to any legal chance. The standard acceptance letter will checklist down all relevant documents (for instance, the FWA Settlement or compliance checklist) and standardises all required modifications to the phrases and situations of employment. The normal rejection letter will contain evidently-worded and legally-suitable factors for rejecting any FWA applications.
- Template Flexible Functioning Settlement: The function of this doc is to established out any variations to the current work agreement or conditions/situations of employment. Whether or not this has to be in the form of a individual contract, an addendum to the employment deal, or a very simple letter of undertaking by the employee, will count on the extent of the improvements necessary.
- Compliance checklist for distant functioning preparations: This is the self-evaluation checklist referred to higher than (see “#4: Obligations in relation to confidentiality and health and safety” above) and is a quite typical doc that employers who have workforce functioning remotely must previously be acquainted with.
- Template FWA termination letter: This template is to provide any FWAs to an finish if demanded. Obtaining this in location will ensure that any legal variations that were being implemented because of to the adjust to a FWA will be appropriately reversed the place essential.
Gains of preparing a Flexible Doing the job Plan and the other advisable paperwork
Although it is not required for companies to have a Flexible Functioning Coverage or any of the other documents suggested in this article, quite a few Malaysian businesses are by now planning these documents, and it is a advised very best observe with quite a few clear positive aspects:
- It plainly communicates the employer’s situation on FWAs to staff, and sets out the employer’s anticipations of any employees who are considering FWAs, as nicely as the repercussions of FWAs such as improvements to compensation and positive aspects.
- Location out the kinds of FWAs recognised by the employer will aid to streamline the variety of FWAs that workers will utilize for. For employers with a significant workforce, this is very important to make sure that there are not way too lots of variations in the form of do the job preparations.
- The standardisation and streamlining of the approach will also help save a lot of time for HR/administration and produce far more certainty in the process from commence to complete. This tremendously lessens publicity to authorized chance for any likely missteps.
- From a sensible viewpoint, getting a very clear Versatile Working Coverage will also aid to make it much easier to justify any rejections of FWA programs that tumble outside the parameters and problems set out in the plan.