The Small and Medium Enterprises Association of Malaysia (Samenta) has opposed a proposal to standardize 16 days of paid annual leave for all workers, regardless of tenure.
According to Free Malaysia Today, Samenta president William Ng said such a move would harm both employees and employers.
Companies already offer 18 to 21 days of leave
Ng emphasized the current tiered system rewards loyalty and helps retain employees, especially those in senior roles.
“Many companies already offer 18 to 21 days of annual leave for employees with over five years of service, and the current Employment Act provides a fair tiered structure with 8 days for employees with 1-2 years of service, 12 days for 2-5 years, and 16 days for those with more than five years,” Ng said.
He warned that enforcing higher leave would increase operational costs and threaten the survival of small and medium businesses, particularly in the struggling retail sector.
“Compulsory 16days leave will boost efficiency.”
The proposal, introduced by Pasir Puteh MP Nik Zawawi Salleh, suggested amending the Employment Act to ensure all workers receive 16 days of annual leave, claiming it would boost efficiency.
Ng also urged the government to amend the Holidays Act to regulate ad-hoc public holidays, which he said disrupt productivity.
Malaysian Employers Federation president Syed Hussain Syed Husman echoed Ng’s concerns, highlighting that leave entitlements generally increase with loyalty and performance.
The proposal has sparked debate over balancing employee benefits and business sustainability, particularly for SMEs.
