Can A Foreign Company Legally Hire Employees In Malaysia?

Hiring an employee in Malaysia involves several crucial steps, beginning with the establishment of a legally binding employment contract. This contract is a fundamental requirement to ensure compliance with Malaysian labor laws.

One pivotal stage in the recruitment process in Malaysia is onboarding. Onboarding plays a pivotal role for all companies operating in Malaysia, as it facilitates the smooth integration of new employees into the workforce. During this process, employees are required to complete various administrative tasks and paperwork. These tasks are essential for employers to set up payroll systems accurately and integrate new hires into the company’s internal systems efficiently.

In addition to the legal employment contract and the onboarding process, it is worth noting that Malaysia has specific regulations and guidelines pertaining to hiring foreign nationals, work permits, and other legal requirements that must be met by both employers and employees. Ensuring compliance with these regulations is vital for a successful hiring process in Malaysia.

Which specific sectors in Malaysia are restricted from hiring foreign workers? As of March 16, 2023, the Malaysian government has imposed a ban on the employment of foreign workers in certain industries. Among the affected sectors are barbershops, goldsmiths, and textile shops. These businesses are now prohibited from recruiting foreign labor, signifying a significant change in the country’s labor policies. This restriction aims to prioritize local employment opportunities and protect the interests of Malaysian workers within these specific industries.

When considering the process of hiring an expatriate in Malaysia, it involves several key stages that are crucial for both the employer and the foreign employee. Here’s a comprehensive breakdown of the process:

1. Company Registration with Expatriate Service Division (ESD): The initial step is to register your company with the Expatriate Service Division (ESD) of the Immigration Department of Malaysia. This registration is a fundamental requirement for any Malaysian company intending to employ expatriates.

2. Activation of Company Account with ESD: Following successful company registration, it is essential to activate your company’s account with ESD. This account allows you to submit and manage expatriate applications efficiently.

3. Expatriate Application via MYXpats CENTRE: Once your company is registered and the account is activated, you can begin the expatriate application process through MYXpats CENTRE. This platform streamlines the application process for hiring foreign talent and ensures that all necessary documents and information are properly submitted.

4. Passport Endorsement & Collection at MYXpats CENTRE: After the application is approved, the final stage involves passport endorsement and collection at MYXpats CENTRE. This step ensures that the expatriate’s travel documents are in compliance with the Malaysian immigration regulations and are ready for their relocation to Malaysia.

Understanding these four essential stages in the expatriate hiring process is vital for employers and expatriates alike to navigate the intricacies of Malaysian immigration procedures effectively.

1. Registration of your company with Expatriate Service Division (ESD) of the Immigration Department of Malaysia.
2. Activation of your company account with ESD.
3. Expatriate application via MYXpats CENTRE.
4. Passport Endorsement & Collection at MYXpats CENTRE.