(From left) Labour department operations deputy director-general Betty Hasan, Kesuma deputy secretary-general Datuk Norison Ramli, Sim, Wong, Kesuma deputy secretary-general Sutekno Ahmad and TalentCorp senior vice president Mahuran Saro Sariki at the recent launch event of the Guidelines for FWA at M Resort & Hotel Kuala Lumpur.
TalentCorp paving the way to smarter employment practices
HUMAN capital is the backbone of a nation’s growth and retaining top talent is essential for continued progress.
In Malaysia, work flexibility has become a significant factor for employees when choosing employment.
Acknowledging this, the government is actively promoting initiatives to support flexible work arrangements (FWA) and encouraging companies to implement these practices.
By prioritising flexibility, Malaysia aims to retain its talent, boost productivity and create a more adaptable and resilient workforce.
The Human Resources Ministry (Kesuma), through Talent Corporation Malaysia Bhd (TalentCorp), in collaboration with the Labour Department, has recently launched the Guidelines for FWA.
These guidelines are part of the ongoing efforts by the government and Kesuma to empower employees and assist employers in optimising their manpower and operational costs.
Established on Jan 1, 2011, TalentCorp, a national agency under the purview of Kesuma, aims to transform Malaysia into a global talent hub and has been entrusted with spearheading a campaign in major cities to encourage companies to implement the guidelines.
Since 2015, TalentCorp has consistently supported employers in implementing FWA by providing the necessary guidance, information and facilitation, in line with the announcement of the Employment Act 1955 (Amendment) 2022.
TalentCorp has conducted FWA workshops, offering guidance and tools to help companies adapt and implement FWA within their organisations, ensuring that both employers and employees can embrace FWA practices.
The recent workshop in Kuala Lumpur, held after the launch of the Guidelines for FWA, was attended by over 500 participants, including industry partners, representatives from the government departments and agencies’ and trade unions.
TalentCorp chairman Wong Shu Qi, in her welcoming speech during the launch event of the Guidelines for FWA at M Resort & Hotel Kuala Lumpur, emphasised that FWA is now a necessity in the post-pandemic era.
Flexible work arrangements empower women, promoting a sustainable and adaptable work culture.
“With more individuals prioritising work-life balance, employers are encouraged to adopt FWA as a strategic step to attract and retain top talent.”She shared that TalentCorp has launched the FWA@Workplace initiative to assist employers in understanding and implementing FWA within their organisations.
“This initiative is highly recommended as a progressive step, not only to enhance work-life balance, but also to cultivate a more flexible, inclusive and sustainable work culture.”
Wong highlighted that this effort is crucial to ensure Malaysia’s workforce can adapt to technological changes, economic demands and modern challenges.
In his keynote address, Human Resources Minister Steven Sim Chee Keong remarked, “The aspirations of employers and employees may seem contradictory at first, but I firmly believe it is not a zero-sum game – we can win together.”Sim highlighted the importance of retaining talent and adapting to modern workplace trends, noting that companies and their leaders operate differently today compared with 20 years ago.
“I believe we have the strength to succeed in this challenging and defining time of our century.”
Citing the 2024 Hays Asia Salary Guide, Sim mentioned that almost 40% of Malaysian workers prioritise flexibility at work over salary, while 36% look for work-life balance and 35% want a positive work environment.
“So, this is an important element in attracting talent.”
Sim emphasised that the government plays a significant role in addressing brain drain and assured that efforts are being made to tackle the issue effectively.
He explained that competition for talent goes beyond governments, stating that companies are also competing with counterparts in Singapore, Thailand and Indonesia. He stressed the need for companies to evolve to attract talent and survive in this new reality.
He pointed out that many employers and employees lack the know-how to implement FWA, adding that the guidelines were created to provide them with the necessary support and direction.
Speaking to reporters later, Sim expressed the belief that creating a more progressive and flexible working environment, which balances work and work-life priorities, would provide a significant advantage to companies, particularly in retaining the workforce.
Sim said TalentCorp, which has been organising workshops on FWA, would conduct a study within the next six months to assess the impact of FWA on companies, particularly in terms of productivity and submit a report to the ministry for further action.
“We have international reports that state that productivity is not affected, but we also want to look at it in the context of Malaysia.”
He said such workshops would continue in major cities, especially in Penang, Johor and the Klang Valley, which are hubs for company headquarters, including small and medium enterprises.
“These workshops will provide more detailed information to companies and workers so that they understand how to implement FWA in their respective places.”
“We hope that by implementing FWA, we can also reduce traffic congestion when working hours are more flexible, or when working from home or from a place closer to home.
“The focus is to create a more conducive work environment to reduce issues such as mental health concerns,” he explained.
As of October 2024, Sim said that 2,826 organisations and 565,210 employees have adopted FWA, demonstrating its transformative potential.
Understanding FWA
The amendment to the Employment Act 1955, effective from Jan 1, 2023, introduced new provisions under Sections 60P and 60Q regarding FWA to enhance workers’ welfare.
These provisions grant employees the right to request FWA to meet current needs and adapt to technological changes.
This guide provides a detailed understanding for employers, employees and trade unions regarding the basic aspects of FWA, such as definitions, types of FWA, methods of implementation, application procedures, approval conditions, appeals and complaints as stipulated under the Act.
Among others, FWA allows employees to determine their working hours, working days, location and methods.
“Work from home is only one form. We give examples of time calculations and situations. When the worker chooses to work in a scheduled manner in terms of time, place and day,” Sim shared.
“We also have outlined the responsibilities of the employees and employers in terms of the schedule in these guidelines.”
FWA allows an employee to request changes to the existing work arrangements agreed upon in their employment contract or collective agreement.
Benefits of FWA
Implementing FWA offers several benefits, including improving work-life balance, boosting company productivity and enhancing employee satisfaction and motivation.
It also attracts more women into the workforce and reduces operational costs for companies.
Additionally, FWA leads to time and transportation cost savings for employees, contributing to a more efficient and cost-effective work environment.
Prime Minister and Finance Minister Datuk Seri Anwar Ibrahim, in his Budget 2025 speech, also highlighted the government’s ongoing efforts to encourage women to return to work by offering a 50% income tax exemption for employers who hire women returning to the workforce for 12 months.
To foster a work-life balance culture while supporting economic goals, the government is also proposing tax incentives for employers, including a 50% tax deduction on costs related to capacity building and software procurement for FWA.
Additionally, a 50% tax deduction would be available for employers covering supplementary care facilities for employees caring for a sick or disabled family member for up to 12 months.
“Anwar’s announcement for companies that implement FWA to enjoy additional tax exemptions shows the sincerity and the will of the government to push for a more progressive and conducive work environment,” said Sim.
Effective role of TalentCorp
TalentCorp offers a 15-minute online FWA Readiness Assessment, providing employers with a detailed report on their organisation’s readiness to implement FWA, along with actionable suggestions for improvement.
To support this transition, TalentCorp adopts a three-pronged approach:
> Advocacy through knowledge-sharing sessions and customised consultations for organisations
> Guidance by developing reference materials and toolkits to help employers adopt good work practices
> Facilitation by assisting with the establishment of childcare centres through workshops and consultations.
These services aim to ease the implementation of FWA and promote a balanced, productive and inclusive workforce in a supportive work environment.
The FWA guidelines are available for download at www.talentcorp.com.my/resources/publications/
