Ministry of Labour and Vocational Training (“MLVT”) issued Prakas 443 Provision of Seniority Payments dated 21 September 2018. This Prakas will take effect from 1 January 2019 and is applicable to seniority payments for employees under unfixed duration contracts (“UDCs”). This is applicable to all industries including non-governmental organizations, associations and private sector entities.

Seniority payments are as followed

1. From 2019 onwards

Employees shall receive seniority payments equivalent to 15 days of wages and fringe benefits per year two times per year according to the following schedule:

(a) 7.5 days of wages and fringe benefits to be paid in June each year; and

(b) 7.5 days of wages and fringe benefits to be paid in December each year.

From 1 January 2019, seniority pay will be payable every 6 months.

Newly joined employees after completing one month of employment will be entitled to 7.5 days of wages and fringe benefits payable in June or December.

2. Prior to 2019

Employees who have worked prior to 2019 shall receive back pay for all past seniority. The maximum amount of the back pay is 6 months of the average base salary in each year of employment up to 31 December 2018.

Backpay in textile, garment and footwear manufacturing (“TGF”) sectors are as follows:

(a) employees in the TGF sectors who have worked before 1 January 2019 and continue to work for an enterprise, will receive 30 days of back pay per year. The maximum is 6 months. Backpay is payable as follows:

(i) 15 days of seniority payment to be paid in June each year; and

(ii) 15 days of seniority payment to be paid in December each year; and

(b) employees in all other sectors who have worked since 1 January 2019 and continue to work for an enterprise, will receive 15 days of back pay per year. The maximum is 6 months. Backpay is payable as follows:

(i) 7.5 days of seniority payment to be paid in June each year; and

(ii) 7.5 days of seniority payment to be paid in December each year.

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