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Retrenchment: The Law and Practice in Malaysia, 2nd Edition

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Retrenchment: The Law and Practice in Malaysia, 2nd Edition  by Ashgar Ali Ali Mohamed and Farheen Baig Sardar Baig

Author Ashgar Ali Ali Mohamed (Dato’ Sri Dr.) and 
Farheen Baig Sardar Baig (Datin Sri Dr.)
Publication Date Oct 2020


Hardcover + Ebook


Publisher: Sweet & Maxwell


  • comprehensive coverage
  • practical and easy-to-read
  • clear explanation of statutory requirements
  • consideration of local and foreign cases as well as Industrial Court awards
  • extensive coverage of Code of Conduct for Industrial Harmony
  • discussion of retrenchment from the Islamic Law Perspective

The importance of job security in the form continuity in employment in an organisation up to the normal retirement age applies to the general working population. Unfortunately, job loss justified by the economic and business needs is an inevitable and painful consequences of a corporate restructuring or reorganisation process. Downsizing can happen when the business no longer requires the same number of employees it used to because the functions of the employee have either ceased or diminished to a significant extent.

The recent Covid pandemic, for example, has placed much strain on businesses, especially government-imposed lockdown and movement control across the globe make it difficult to secure new business or continue with ongoing projects. It is, however, essential that the termination of an employment contract on the grounds of redundancy must flow from justifiable grounds which must be bona fide and be untainted by any unfair labour practice.

This updated edition provides a comprehensive coverage on the recent and significant developments in the law and practice of retrenchment in Malaysia.

This title provides a complete discussion of

  • the concepts and the causes leading to redundancy;
  • retrenchment and lay-off;
  • steps an employer should follow when ther is a need to retrench;
  • situations where a retrenched worker would be able to recover compensation;
  • circumstances where a retrenched employee may contest the retrenchment exercise;
  • preferential entitlement of an employee in the event the employer goes into liquidation;
  • proposal for the setting up of a retrenchment fund and the mechanism of its functioning;
  • retrenchment from the Islamic law perspective and the usage of Zakat moeny to assist unemployed Muslims until they secure new employment.

Written by authors who have wide experience in employment law, this book makes regular reference to statutory sources and cases from the courts to explain the working of the law and practise of retrenchment. This book will certainly provide much-needed information to employers, employees and their legal advisers.


  • Chapter 1: Retrenchment: An Introduction and an Overview
  • Chapter 2: Security of Tenure vs Management Prerogative to Discharge Surplus Labour
  • Chapter 3: Redundancy, Retrenchment and Lay-Off
  • Chapter 4: Redundancy to Retrenchment: Justifiable Reasons 
  • Chapter 5: Retrenchment: The Law in Malaysia 
  • Chapter 6: Code of Conduct for Industrial Harmony
  • Chapter 7: Change of Ownership of Business and the Continuity of Contract of Employment 
  • Chapter 8: Outsourcing 
  • Chapter 9: Voluntary Separation Scheme
  • Chapter 10: Retrenchment Benefits
  • Chapter 11: Accepting Retrenchment Compensation and Alleging Unfair Dismissal
  • Chapter 12: Dismissal Under Guise of Retrenchment
  • Chapter 13: Retrenchment: The Evidential Burden and Consequence for Failure to Discharge Burden
  • Chapter 14: Redundancy to Retrenchment: Selected Industrial Court Awards 
  • Chapter 15: Preferential Payment of Retrenchment Benefits and the National Insurance Fund
  • Chapter 16: Termination Benefits and Training Schemes under Employment Insurance System Act 2017 and Pembangunan Sumber Manusia Berhad Act 2001
  • Chapter 17: The Islamic Approach to Retrenchment
  • Chapter 18: Employer’s Guide to Bona Fide Retrenchment


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