Malaysia Annual Leave Encashment Calculator
Calculate statutory paid annual leave accrual, Ordinary Rate of Pay (ORP: basic wage / 26 days), and final leave encashment compensation in Malaysian Ringgit (MYR).
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Salary & Leave Parameters
Statutory Leave Matrix
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Engr. Muhammad Shahzad
Verified Systems Specialist & EngineerPrincipal systems architect and statutory compliance engineer. Specialist in Malaysian statutory frameworks, LHDN income tax schedules, EPF/KWSP regulations, and Bank Negara Malaysia financing guidelines.
Frequently Asked Questions (Statutory FAQs)
How many days of paid annual leave are employees entitled to in Malaysia?
Under Section 60E(1) of the Employment Act 1955: Less than 2 years service: 8 days/year; 2 to less than 5 years service: 12 days/year; 5 years service or more: 16 days/year.
How is the Ordinary Rate of Pay (ORP) calculated for leave encashment?
Under Section 60I, the daily Ordinary Rate of Pay (ORP) for monthly-rated employees is calculated as: Monthly Basic Wage divided by 26 days.
Can untaken annual leave be forfeited at the end of the year?
Unless company employment contract or collective bargaining agreement allows carry-forward or encashment, statutory leave not taken within 12 months after the entitlement year can be forfeited if the employer provided reasonable opportunity to take it.
Is annual leave encashment mandatory upon employment termination in Malaysia?
Yes. Under Section 60E(2), upon termination of employment (resignation, dismissal, or redundancy), the employer must pay the employee pro-rated payment in lieu of any untaken accrued annual leave.
Is leave encashment pay subject to EPF, SOCSO, and PCB tax in Malaysia?
Yes. Payment in lieu of untaken annual leave is classified as remuneration and is subject to statutory EPF, SOCSO, EIS contributions and LHDN PCB tax deductions.