Posted on: 2021-12-06
So you just got hired, great! However, you are not sure what to expect. Many questions run through your mind, “Do I have to work on weekends? What if I have to work overtime?”. Well fret not, this article will serve as a guide to everything you and your employer will need to know about the Employment Act.
Here is a summary of what you should be taking away from this post.
The Employment Act covers employees both local and foreign that are hired by a contract with an employer except seafarers, domestic workers, statutory board employees or civil servants.
The content of this post lies under Part IV of the employment act and only applies to those who do manual labor and are earning a basic monthly pay of $4,500 or less and those who are doing non-manual labor earning $2,600 or less
Regular working hours are the working hours stated in the contract that you and your employer have agreed on..
Plus, did you know that employees should not be working more than 12 hours a day? Unless it is due to an accident or a threat of one, work that is crucial for the safety of society, critical machinery or plant work and unforeseen circumstances. If your employer requires you to work between 12 - 14 hours a day, overtime exemption can be applied.
Overtime pay is for the overtime work that is done after normal working hours (excluding breaks). For employees doing non-manual labor, the overtime rate payable is limited at the salary level of $2,600 or an hourly rate of $13.60. The maximum number of overtime hours per month is 72 hours. However, take note that work done on rest days or holidays are not counted as overtime work and is thus not counted into the 72 hour limit.
Overtime can be claimed if:
In addition, there are also 3 different categories of employees with different hourly basic rate of pay:
If you are working overtime, your employer is expected to pay you at least 1.5 times the basic hourly rate and must be paid within 14 days after the last day of the salary period. So how can we calculate our overtime pay? Let me show you an example.
The basic formula used to calculate overtime pay = Hourly basic rate of pay x 1.5 x Number of overtime hours
Let’s say Jane is an employee doing non-labour where her pay is monthly- rated of $1000/ month and has worked 2 hours overtime.
Hourly basic rate of pay = (12 x 1000) / (52 x 44) = 5.245 Overtime pay = 5.245 x 1.5 x 2 = $15.73
Remember! You are entitled to 1 rest day per week that is unpaid. For shift workers however, the rest day can extend to a period of 30 consecutive hours. Unless there is a special case, your employer cannot force you to work on a rest day.
Your employer decides on your rest day and if it is not a Sunday, your employer is required to provide a schedule with your rest days indicated at the start of each month. To add on, an employee should not be working more than a maximum of 12 days continuously before a rest day is given.
This is how pay for working on a rest day is calculated:
For more Information, visit the MOM website here.
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