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KUALA LUMPUR: The compulsory retirement age of private sector employees will be raised to 60 under the Minimum Retirement Age Bill 2012, which was tabled for first reading at the Dewan Rakyat today.
The Bill, which was tabled by Human Resource Minister Datuk Seri Dr S.Subramaniam, states that an employer shall not retire an employee prematurely before he attains the minimum retirement age.
It said, notwithstanding, irrespective of the minimum retirement age, an employees may retire when they reach the optional retirement age agreed upon in the contract of service or collective agreement.
For an employee, who chooses to retire earlier that the minimum retirement age, the contract of service or collective agreement signed before shall be deemed void when the act is in force.
The Bill enables an employee who believes he has been prematurely retired to make a complain in writing to the Labour Department director-general within 60 days of the retirement.
If the director-general finds that the complaint is justified, the employer may be instructed to reinstate the employee in his former employment or pay the employee his salary arrears from the date premature retirement until the date of reinstatement.
Alternatively, the director-general may direct the employer to pay the employee a compensation in liew of reinstatement not exceeding the amount of total salary that is calculated from the date he has been prematurely retired until he attains the minimum retirement age.
If the directive is ignored, the employer faces a fine not exceeding RM10,000 upon conviction.
On the contrary, the Bill does not apply to a person who is employed on a permanent, temporary or contractual basis and is paid emoluments by the Federal Government, any state government, any statutory body or any local authorities.
It also excludes a person employed on probation, a non-citizen employee, a domestic servant, a person who is employed in any employment with an average working hours not exceeding 70 per cent of the normal working hours of a full-time employee and a student who is employed on contract for a temporary term of employment.
A person, who has retired at 55 or above before the Act comes into operation, subsequently is reemployed is also excluded from the Bill. -- BERNAMA