Effective from 1 June 2024, significant amendments to the Occupational Safety and Health Act 1994 (“OSHA”) and the repeal of the Factories and Machinery Act 1967 (“FMA”) will introduce substantial changes affecting workplaces across Malaysia.
Key Amendments and Implications
- Extended Scope of Workplace Obligations: Under the amended OSHA, statutory health and safety obligations now encompass all workplaces, including those engaged in remote work arrangements. This expansion marks a departure from previous sector-specific coverage limited to industries like manufacturing, construction, and retail.
- Enhanced Duties on Employers, Self-Employed, and Principals: Employers, self-employed individuals, and principals are now mandated to conduct thorough risk assessments concerning safety and health risks associated with their operations. This includes identifying workplace hazards and implementing appropriate measures for risk mitigation.
- Appointment of Safety and Health Coordinator (SHC): In compliance with the amended regulations, employers operating workplaces with five or more employees must designate a Safety and Health Coordinator (“SHC”). The role of the SHC is pivotal in overseeing and coordinating occupational safety and health initiatives, particularly in workplaces not necessitating a SHC.
- Principal’s Obligations Towards Contractors and Sub-contractors: Principals are now legally obligated to ensure the safety and health of contractors, subcontractors, and their respective employees when engaged under their direction. This obligation is particularly significant in sectors reliant on contractual relationships, such as the construction industry.
- Emergency Procedures and Employee Rights: Employers, self-employed individuals, and principals are required to establish and implement comprehensive emergency procedures. Furthermore, employees are granted the right to withdraw from situations of imminent danger in their workplace, safeguarded against repercussions or discriminatory actions.
- Monitoring of Workplace Conditions: The revised legislation empowers the Minister of Human Resources to regulate the monitoring of workplace conditions, encompassing aspects like ergonomic standards, physiological well-being, and psychological health of employees by employers or occupiers.
- Penalties for Non-Compliance: Penalties for breaches of occupational safety and health duties have been substantially heightened, with fines ranging from MYR 100,000.00 to MYR 500,000.00, alongside the possibility of imprisonment for up to two (2) years. In fact, individuals holding managerial positions may also be held personally accountable unless they can demonstrate a lack of knowledge or involvement in the offence.
It can be seen that these changes seek to align with Malaysia’s broader Environmental, Social, and Governance (ESG) initiatives, emphasizing the importance of sustainable practices and employee well-being in corporate governance. By embracing these amendments, businesses not only enhance legal compliance but also contribute positively to Malaysia’s goals of fostering safer, healthier workplaces and sustainable economic development. The increased penalties for non-compliance underscore the seriousness with which these obligations are to be taken, urging proactive adherence to avoid legal ramifications and uphold ethical business practices.
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This article was written by George Teng (Associate) from Donovan & Ho’s corporate & commercial practice.
Donovan & Ho is a law firm in Malaysia, and our employment practice group has built a reputation for providing strategic employment advice to local and global organisations. Our team of employment lawyers provide advice on employment law and industrial relations including review of employment contracts, policies and handbooks, advising on workforce reductions, and managing dismissals of employees for poor performance or misconduct. We also represent clients in unfair dismissal claims and employment-related litigation. Have a question? Please contact us.
