KESUMA reminds private sector employers in Malaysia that FWAs must be implemented in an "orderly, phased manner"
Summary
The Ministry of Human Resources Malaysia (KESUMA) has reiterated that flexible working arrangements (FWA) in the private sector must be rolled out in an orderly, phased way and follow clear guidelines, in line with the Employment Act 1955 (Amendment) 2022 under sections 60P and 60Q.
The ministry stressed that FWA covers more than working from home (WFH): it includes hybrid models, flexible hours, compressed workweeks, shift work and output-based arrangements. Employers may not reduce salaries or benefits for employees who WFH unless a new agreement changes overall working hours.
KESUMA highlighted TalentCorp data showing uptake and positive outcomes from structured FWA implementation, while also warning employers to manage psychosocial risks (stress, isolation, work-life balance) and provide mental wellbeing support.
The FWA guidelines (Aturan Kerja Fleksibel/AKF) were launched on 5 December 2024 to help employers and employees apply the Employment Act amendments fairly and consistently.
Key Points
- KESUMA requires FWAs to be implemented in an orderly, phased manner and according to clear guidelines tied to the Employment Act 1955 (Amendment) 2022 (sections 60P, 60Q).
- FWA encompasses WFH, hybrid work, flexible hours, compressed weeks, shifts and output-based arrangements — not just working from home.
- Employers cannot cut pay or benefits for employees working from home unless a new agreement alters overall working hours.
- TalentCorp data: over 3,000 organisations adopted FWAs, benefiting more than 1.2 million employees.
- Reported outcomes: 62% of employers saw productivity rise with structured FWAs; 70% of employees reported higher job satisfaction; over 90% saw increased engagement and turnover reduction of 15–20%.
- KESUMA warns of psychosocial risks tied to FWA/WFH and urges clear work management, empathetic communication, reasonable hours and access to mental health support like counselling.
- The FWA guidelines (AKF) launched 5 December 2024 provide the operational framework for requests and employer assessments under the amended Employment Act.
Why should I read this?
If you employ people in Malaysia (or manage HR policies there), this is not optional bedtime reading — it affects how you must handle requests for flexible work and what you can and cannot do on pay and benefits. KESUMA’s reminder bundles legal guardrails, performance data and wellbeing warnings into one short, actionable message.
Author note: Punchy — read the detail if you need to update contracts, HR policy or line-manager guidance. We’ve saved you the slog: key legal limits, positive business metrics and wellbeing caveats are all here.