Contract of Service

What is Contract of Service?
Section 2 (1) of Employment Act 1955
"Contract of service" means any agreement, whether oral or in writing and whether express or implied, whereby one person agrees to employ another as an employee and that other agrees to serve his employer as an employee and includes an apprenticeship contract.

Comment:
(i) The contract of service may be implied or in writing. However, certain contract must be in writing, if it is for a specified period of time exceeding one month, or for the performance of a specified piece of work exceed one month (Section 10 (1)). It shall include provision for termination (Section 10 (2)).

(ii) Employment Regulalation 1957 5(b) require the following terms be given in writing:-
(a) Name of employee and National Registration Identification Card No.;
(b) Occupation or appointment;
(c) Wage rates (excluding other allowances)
(d) Other allowances payable and rates;
(e) Rates for overtime work;
(f) Other benefits (including approved amenities and services);
(g) Agreed normal hours of work per day;
(h) Agreed period of notice of termination of employment or wages in lieu;
(i) Number of days of entitlement to holidays and annual leave with pay; and
(j) Duration of wage period.

The above serve as the minimum terms that is requires to be in writing, however additional terms may be included, depend on the individual organizations, professional firms or institutions, as follows:
(a) Location of work, transfer and relocation clause;
(b) Penalties for misconduct;
(c) Confidentiality clause;
(d) Return of property upon termination of contract, include tangible and intangible;
(e) Working for another part time job; and
(f) Requirement to go for compulsory medical check up.

(iii) Any terms which is less favourable than that prescribed by this Act or Regulations is null and void (Section 7)

(iv) Any terms which is more favourable than that prescribed by this Act or Regulations shall be valid (Section 7A)

(v) Contracts of service can not restrict rights of employees to join, participate in or organize trade unions (Section 8)