Labour Contract Termination Letter for Malaysia

Labour Contract Termination Letter Template for Malaysia

A Labour Contract Termination Letter is a formal document used in Malaysia to officially end an employment relationship between an employer and employee. The document must comply with Malaysian employment law, particularly the Employment Act 1955 and related regulations. It outlines the termination details, including the effective date, notice period, final payment calculations, and post-employment obligations. The letter serves as a legal record of employment termination and typically includes provisions for the return of company property, confidentiality obligations, and final settlement of employment benefits in accordance with Malaysian labor regulations.

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What is a Labour Contract Termination Letter?

The Labour Contract Termination Letter is a crucial document in Malaysian employment practice, used to formally document the end of an employment relationship. It must be drafted in compliance with the Employment Act 1955 and other relevant Malaysian employment legislation. This document is typically used when employment is terminated due to various reasons such as resignation, retirement, redundancy, or performance issues. The letter should include specific details required by Malaysian law, including notice periods, final payment calculations, and benefit entitlements. It serves multiple purposes: legally documenting the termination, clarifying final obligations and entitlements, and protecting both employer and employee interests. The content and format must align with Malaysian employment regulations to ensure validity and enforceability.

What sections should be included in a Labour Contract Termination Letter?

1. Letter Header and Date: Company letterhead, date, and reference number if applicable

2. Recipient Details: Employee's full name, position, and address

3. Subject Line: Clear indication that this is a termination letter

4. Termination Statement: Clear statement of employment termination with specific end date

5. Notice Period Details: Information about notice period or payment in lieu of notice

6. Reason for Termination: Brief explanation of termination reason if applicable

7. Final Payment Details: Overview of final salary, benefits, and other entitlements

8. Company Property Return: List of company items to be returned

9. Confidentiality Reminder: Reminder of ongoing confidentiality obligations

10. Contact Information: HR contact details for queries

11. Signature Block: Authorized signatory details and signature space

What sections are optional to include in a Labour Contract Termination Letter?

1. Garden Leave Provisions: Include when employee is placed on garden leave during notice period

2. Non-Compete Reminder: Include if employee is bound by non-compete clauses

3. Severance Package Details: Include for redundancy or mutual separation scenarios

4. Outstanding Loans: Include if employee has outstanding company loans

5. Handover Instructions: Include for senior positions requiring detailed handover

6. Reference Provision: Include if company agrees to provide employment references

7. Medical Benefits Extension: Include if medical benefits are extended post-termination

What schedules should be included in a Labour Contract Termination Letter?

1. Final Payment Calculation: Detailed breakdown of final payment including salary, leave, and benefits

2. Company Property Checklist: Itemized list of company property to be returned

3. Employee Benefits Summary: Summary of benefits status and post-termination arrangements

4. Exit Clearance Form: Checklist for various department clearances

5. Handover Document Template: Template for documenting handover of responsibilities

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Malaysia

Publisher

Genie AI

Cost

Free to use
Relevant Industries

Manufacturing

Financial Services

Technology

Retail

Healthcare

Construction

Education

Professional Services

Hospitality

Telecommunications

Mining

Agriculture

Transportation

Energy

Real Estate

Relevant Teams

Human Resources

Legal

Compliance

Administration

Employee Relations

Personnel Management

Industrial Relations

Corporate Services

Operations Management

Relevant Roles

Human Resources Director

HR Manager

Legal Counsel

Department Manager

CEO

Managing Director

HR Executive

Compliance Officer

Administrative Manager

Operations Director

General Manager

Regional Manager

Branch Manager

Senior HR Associate

Employee Relations Manager

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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