Know your obligations before you restructure. And the exposure if you don't.
Calculate statutory severance pay, notice period, and total liability per employee under the Employment Act 1955 - then see the worst-case Industrial Court exposure if any of it goes wrong. One procedural mistake costs 12-24 months of backwages per employee.
The minimum number is just the start of the conversation.
The calculation below shows your minimum statutory obligation. The exposure number shows what happens if you get the procedure wrong. Severance pay, notice period, and ETLBR benefits are the floor. The Industrial Court doesn't argue about the floor - it argues about whether the retrenchment was lawful in the first place. LIFO selection, Code of Conduct compliance, DG-IR notifications, and clean documentation are what turn a lawful restructuring into a defensible one. Skip any one of them and you're paying 12-24 months of backwages per employee, not just the statutory minimum.
Calculate the obligation. And the exposure.
Four inputs. Live calculation. Outputs include the minimum statutory benefits per employee plus the total cohort liability - and the worst-case Industrial Court exposure if the retrenchment is contested. Statute citations under every result.
Five questions employers ask before restructuring.
Written for the question typed into Google at 7:45am, and marked up as FAQPage for AI overviews on every other day.
Q · 01
Who is eligible for termination benefits under EA 1955?
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Employees covered by the Employment Act 1955 who have completed at least 12 months of continuous service. Pre-2022, coverage was capped at RM2,000/month; post the 2022 EA amendments, EA coverage was extended to virtually all employees regardless of salary (with limited exceptions). The ETLBR severance brackets: <2yrs = 10 days/year · 2-5yrs = 15 days/year · 5yrs+ = 20 days/year.
Q · 02
What is the LIFO principle in Malaysian retrenchment?
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Last-In, First-Out - the default selection principle under the Code of Conduct for Industrial Harmony. Within the affected job category, employees with shorter service are retrenched first. Foreign workers should be retrenched before locals in the same role. Departures from LIFO are permissible if justified (e.g. demonstrated skill differences), but require documented rationale - and the Industrial Court reviews that rationale carefully if challenged.
Q · 03
What happens if retrenchment is done improperly?
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An employee can file a section 20 IRA 1967 complaint for unfair dismissal within 60 days. If the matter reaches the Industrial Court and the retrenchment is found unlawful, the award is typically 12-24 months of backwages per employee, plus reinstatement or compensation in lieu. The most common Maslow-observed failure modes in 2025: informal "voluntary" exits reframed as dismissals, breach of LIFO within an affected class, late or missing DG-IR notifications, and inconsistent documentation across exits.
Q · 04
Is the employer required to report retrenchments?
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Yes. Employers must notify JTKSM (Jabatan Tenaga Kerja Semenanjung Malaysia) at least 30 days before the retrenchment, using the prescribed form (Borang PK). Failure to notify is a strict-liability offence and is one of the easiest procedural errors for an Industrial Court reference to surface. The notification triggers a brief DG-of-IR review period - Maslow's IR practice routinely manages this notification end-to-end.
Q · 05
What about a Voluntary Separation Scheme (VSS) instead?
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VSS is often the cleaner route - but it has to be genuinely voluntary. The Industrial Court frequently sees employees who took a VSS package, then later claim constructive dismissal - alleging the "voluntary" exit was coerced. Genuine VSS requires: open eligibility within an affected class, transparent terms, freedom to decline without consequence, and a reasonable consideration window. Maslow's IR practice designs the VSS architecture (eligibility, quantum, timeline) and audits it against post-2022 case law before rollout.
Got the number. Now ask the follow-up.
Every tool produces a calculation. The follow-up question - "why is that number what it is", "what should I do with it", "what would change it" - is what Maia is for. Ask her about any tool, before or after you run it.
"How much HRDC are we leaving unclaimed?"
Maia walks through the levy formula, claimable rate vs entitlement, and the deadline math. Then runs the calculation with you.
"What's our retrenchment exposure?"
Per-employee severance, notice, ETLBR benefits - plus the worst-case Industrial Court exposure of getting any of it wrong.
"Are we paying our senior managers correctly?"
Maslow Databank cuts by industry × function × level. Median, range, top quartile. Where you sit relative to retention risk.
"Where is our HR function exposed?"
The 6-dimension HR Maturity Assessment, with the partner read on what to prioritise based on your score.
Four questions about the tools.
Written for the question typed into Google at 7:45am, and marked up as FAQPage for AI overviews on every other day.
Q · 01
Are the tools really free? What's the catch?
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Yes - fully free. No login, no signup, no email-gate, no PDF download required. The tools are an honest commercial play: if they answer your question well, we earn the right to be the next call when the question is bigger than a calculator can answer. That's the whole catch. Your inputs run in your browser and are never sent to Maslow.
Q · 02
How are the calculations validated?
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Every tool's calculation is anchored to statute or the Maslow Databank. The HRDC Calculator runs against the HRD Corp Act 2001 (Act 612) and the SBL Khas / HRDC Plus scheme rules. The Retrenchment Calculator runs against EA 1955, ETLBR 1980, and s.20 IRA 1967. The Salary Benchmark runs against the proprietary Maslow Salary & Benefits Databank, refreshed annually across 20+ Malaysian sectors. The HR Maturity Assessment is Maslow's own proprietary methodology, refined since 1998.
Q · 03
Will my inputs be stored or sent to Maslow?
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No. All calculations run client-side in your browser. Your inputs are not transmitted to Maslow servers, not stored in any database, not used to populate a CRM. The only data Maslow receives is what you choose to share - by clicking a "Discuss with a partner" CTA after a calculation, by emailing customer care, or by asking Maia a follow-up question.
Q · 04
How accurate is the Salary Benchmark for Malaysian roles specifically?
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The benchmark is built specifically for Malaysian pay markets - 20+ MY sectors cut by industry × function × experience level × location. Malaysian pay markets do not map cleanly to ASEAN or APAC averages, so generic global reports often misprice mid-management bands. The Maslow Databank is refreshed annually from the firm's active engagement portfolio (anonymised). For a deeper conversation about a specific role, the full Salary Benchmarking sub-practice under SHRC Strategic Talent runs custom pay-band design and pay-equity reviews.
Four tools. Free. The conversation is optional.
Run the calculation that matters. Save the screenshot. Take it to your next board meeting. If the number raises a follow-up the calculator can't answer, the conversation is one click away - always free, always with a senior consultant.
