Sick Leave Entitlement in Malaysia: A Practical Guide for HR
Sick leave is an important benefit that allows employees to rest and recover when they are unwell. In Malaysia, sick leave entitlements are protected by law under the Employment Act 1955, and HR practitioners must ensure that these entitlements are given fairly and managed properly.
This article explains what HR teams need to know about sick leave entitlement, how to handle applications, and what to do in cases of misuse or long-term illness.
1. Who Is Entitled to Sick Leave?
If you are an employee working in Peninsular Malaysia, you are covered by the Employment Act 1955, no matter how much you earn. This means you have the legal right to take sick leave if you are ill and have followed the proper steps to apply.
2. How Many Days of Sick Leave Are Employees Entitled To?
Under the Act, the number of paid sick leave days an employee is entitled to depends on how long they have worked for the company:
Outpatient Sick Leave (when no hospitalisation is needed)
- Less than 2 years of service: 14 days per year
- 2 to 5 years of service: 18 days per year
- More than 5 years of service: 22 days per year
Hospitalisation Leave
- Up to 60 days per year, in addition to outpatient sick leave, if a doctor certifies that hospitalisation is necessary.
- If the employee is not admitted to a hospital but is certified as needing hospital care, this still counts as hospitalisation leave.
Since 1 January 2023, hospitalisation leave is no longer combined with sick leave. They are now treated separately.
3. How Should Sick Leave Be Applied?
To be eligible for paid sick leave:
- The employee must get a medical certificate (MC) from a registered doctor (company panel, government clinic, or dentist).
- The employee must inform the company within 48 hours from the start of their sick leave, or it will be treated as absent without permission.
If these steps are followed, employers must pay the employee their usual daily wages for the approved sick leave.
4. What If Sick Leave Is Misused?
Sick leave is a paid benefit, and sometimes employees may misuse it. Here are some common situations HR should watch out for:
a. Absent Without Notice
If an employee is absent from work for more than 2 working days in a row without informing the company, this can be treated as a breach of contract (abandonment of job).
b. Taking Too Many Sick Days
Excessive sick leave, even with MCs, can raise concerns—especially if there is a pattern. It may indicate a medical condition or intentional avoidance of work. HR should monitor and address this carefully.
c. Malingering (Faking Illness)
If an employee is caught doing non-sick activities (like travelling or social outings) while on MC, this may be considered misconduct. Even with an MC, it’s important that the employee behaves responsibly.
5. What If the Employee Can No Longer Work Due to Illness?
If an employee becomes too ill to return to work for the long term:
- HR should ask for a medical report to confirm the situation.
- Give the employee time to recover before considering any action.
- Consider offering the employee alternative duties or a lighter role where possible.
Only after exploring all options and showing support should termination due to medical reasons be considered and it must be well-documented and fair.
6. What Should HR Do to Manage Sick Leave Better?
Here are some tips to help HR handle sick leave effectively:
- Have a clear sick leave policy in your staff handbook
- Track leave records accurately and watch for patterns
- Require MCs for all sick leave claims
- Use panel clinics to manage medical costs and verification
- Communicate procedures clearly to all staff
- Act quickly if you suspect abuse, but always investigate first
- Show empathy for employees who are genuinely ill and consider flexible work options where possible
7. Final Thoughts
Sick leave is a legal right, not a favour. Employees should be responsible when using it, and HR teams must make sure the rules are followed and that leave is handled fairly and consistently.
At the same time, HR must also be prepared to take action when there are signs of misuse. This includes absenteeism without notice, malingering, or ongoing unfitness to work.
Simplify Leave Management with CentralHR
Keeping track of medical certificates, monitoring sick leave balances, and identifying leave abuse can be time-consuming. With CentralHR’s Leave Management System, you can:
- Automate leave tracking
- Access real-time reports on employee leave trends
- Ensure compliance with the Employment Act 1955
Let us help you streamline your HR processes. Contact us to schedule a free demo today!
Frequently Asked Questions (FAQs)
1. Can unused sick leave be carried forward to the next calendar year?
No. Under the Employment Act 1955, sick leave entitlement resets every calendar year and cannot be carried forward. Any unused sick leave from the previous year is forfeited.
2. Can employees use sick leave to care for family members?
No. Sick leave is strictly for the employee’s own medical condition. It cannot be used to care for sick family members unless the company provides additional compassionate or emergency leave in their policy.
3. Can an employer reject an employee’s sick leave or hospitalisation leave application?
Only if the employee fails to submit a valid medical certificate or does not notify the employer within 48 hours, as required by Section 60F of the Employment Act. If procedures are followed, employers cannot legally refuse paid sick or hospitalisation leave.
4. When can an employer request proof of illness?
Employers can require employees to submit a medical certificate (MC) for any sick leave taken. It must be issued by a registered medical practitioner, government doctor, or company panel clinic. Proof can be requested regardless of the duration of the leave.
5. What happens if an employee uses up all their paid sick leave?
Once an employee has exhausted their annual sick leave entitlement (and hospitalization leave if applicable), any further absence due to illness may be treated as:
- Unpaid sick leave, if supported by an MC and approved by the employer, or
- Unpaid leave of absence, at the employer’s discretion.
Alternatively, the employee may apply for annual leave if available.
