STATUTORY AND LOCAL AUTHORITIES PENSIONS ACT 1980

LAWS OF MALAYSIA ONLINE VERSION OF UPDATED TEXT OF REPRINT Act 239 STATUTORY AND LOCAL AUTHORITIES PENSIONS ACT 1980 As at 15 October 2024 This text is ONLY AN UPDATED TEXT of the Statutory and Local Authorities Pensions Act 1980 by the Attorney General’s Chambers. Unless and until reprinted pursuant to the powers of the Commissioner of Law Revision under subsection 14(1) of the Revision of Laws Act 1968 [Act 1], this text is NOT AN AUTHENTIC TEXT. 2 STATUTORY AND LOCAL AUTHORITIES PENSIONS ACT 1980 … … … … 31 July 1980 Date of Royal Assent Date of publication in the Gazette … … … … 7 August 1980 Latest amendment made by Act A1410 which came into operation on … … … … 1 January 2012 PREVIOUS REPRINTS First Reprint … … … 2001 Second Reprint … … … 2006 3 LAWS OF MALAYSIA Act 239 STATUTORY AND LOCAL AUTHORITIES PENSIONS ACT 1980 ARRANGEMENT OF SECTIONS Section 1. Short title, commencement and application 2. Interpretation 3. Pension, etc., not an absolute right 4. Pension, etc., charged on the Consolidated Fund 5. Computation of pension, etc. 6. Conferment of pensionable status 6A. Exercise of option 6B. Pensionable employee may opt for the Employees Provident Fund Scheme 6C. Retrospective contributions to the Employees Provident Fund 6D. Employer may offer Employees Provident Fund Scheme 6E. Pensionable employee may opt for Pension And Employees Provident Fund Scheme 6F. Employer may offer scheme under section 6 E 6G. Continued application of this Act and application of Act 452 7. Employees deemed to be pensionable employees 8. Contributions 9. Grant of pensions, etc. 10. Compulsory retirement Laws Of Malaysia 4 ACT 239 Section 11. Retirement at the instance of the Minister 12. Optional retirement 13. Retirement on being appointed to serve in organization 14. Retirement in the public interest 15. A derivative pension or gratuity where an employee dies in service 16. Derivative pension where an employee dies after retirement 16A. Circumstances in which person to be disqualified from being paid derivative pension or derivative retiring allowance where not resident or ceasing to be resident in Malaysia 17. Cessation of derivative pension 18. Cessation of pension in respect of child attaining age of eighteen deemed valid 19. Disability pension 20. Dependant’s pension 21. Pension, etc., not to be assignable 22. Pension, etc., to cease on bankruptcy 23. Pension, etc., to cease on conviction 23A. Pension, etc., to cease on acquiring citizenship of other country 24. Maximum pension 25. Lowest pension for full service 26. Suspension of pension 27. Payment without probate or letters of administration 28. Regulations 29. Previous actions 30. Payment of reward for information 31. Winding up of pension scheme 5 LAWS OF MALAYSIA Act 239 STATUTORY AND LOCAL AUTHORITIES PENSIONS ACT 1980 An Act to provide for the administration of pensions, gratuities and other benefits for employees in the statutory and local authorities and their dependants pursuant to the revision of salaries and terms and conditions of service of such employees made by the Government with effect from 1 January 1976. [1 January 1976] BE IT ENACTED by the Seri Paduka Baginda Yang di-Pertuan Agong with the advice and consent of the Dewan Negara and Dewan Rakyat in Parliament assembled, and by the authority of the same, as follows: Short title, commencement and application 1. (1) This Act may be cited as the Statutory and Local Authorities Pensions Act 1980 and shall be deemed to have come into force on 1 January 1976. (2) This Act shall apply throughout Malaysia in respect of employees in the statutory and local authorities— (a) who have opted or who are deemed to have opted for the New Scheme; (b) who were appointed under the New Scheme; or (c) who by virtue of their option were bound by the New Scheme. Laws Of Malaysia 6 ACT 239 Interpretation 2. In this Act, unless the context otherwise requires— “appropriate authority” means the board or management of a statutory or local authority; “employee” means a person on full time employment of a statutory or local authority; “Employees Provident Fund” means a provident fund established under the Employees Provident Fund Act 1991 [Act 452], including an approved fund as defined in that Act; “Employees Provident Fund Scheme” means a scheme under which an employee ceases to be eligible to be conferred the status of a pensionable employee or ceases to be a pensionable employee and is instead required to contribute, together with his employer, to the Employees Provident Fund; “employer” means a statutory or local authority; “last drawn salary” means the actual last drawn monthly substantive salary paid to an employee before his retirement or death or in the case of retirement under subsection 13(2), his actual last drawn monthly substantive salary paid to him by the organization whilst he is on the same terms and conditions of service as in the New Scheme; provided that in respect of an employee who is receiving any pensionable allowance, such pensionable allowance shall form part of his last drawn salary; “Minister” means the Minister charged with the responsibility for pensions; “New Scheme” means the revised salaries and terms and conditions of service of employees in the statutory and local authorities arising from the revision of salaries and terms and conditions of service of such employees made by the Government with effect from 1 January 1976, or from any other subsequent revision made or approved by the Government from time to time; Statutory and Local Authorities Pensions 7 “Pension And Employees Provident Fund Scheme” means a scheme under which an employee continues to be a pensionable employee and is required to contribute, upon his option taking effect and by virtue of his option, to the Employees Provident Fund; “pensionable employee” means an employee who has been conferred pensionable status under section 6 or deemed to have been conferred pensionable status under subsection 6A(6C) or section 7; “pensions authority” means the Director General of Public Services or any officer authorized by him in writing to act on his behalf; “reckonable service” means service prescribed as reckonable service under the regulations; “regulations” means regulations made under section 28; “salary” means a monthly salary including any pensionable allowance payable in accordance with the salary scales of the New Scheme; “service” means service under the Government, any State Government, or in any statutory or local authority; and “statutory or local authority” means a statutory or local authority within the purview of the New Scheme. Pension, etc., not an absolute right 3. (1) No employee shall have an absolute right to compensation for past service or to any pension, gratuity or other benefit under this Act. (2) Where it is established to the satisfaction of the Minister by an appropriate authority that an employee has been guilty of negligence, irregularity or misconduct, the Minister may reduce or withhold the pension, gratuity or other benefit for which such employee would be eligible but for this section. 8 Laws Of Malaysia ACT 239 Pensions, etc., charged on the Consolidated Fund 4. (1) Pensions, gratuities and other benefits granted under this Act shall be charged on the Consolidated Fund from 1 January 1981. (2) Payment of any pension, gratuity or other benefit granted under this Act up to 31 December 1980 shall be made from the Fund established under the Statutory and Local Authorities Superannuation Fund Act 1977 [Act 185]. Computation of pensions, etc. 5. (1) Any pension, gratuity or other benefit granted under this Act shall be computed in accordance with the regulations; provided that, in the case of retirement under paragraph 10(5)(a) or under section 13, the amount of pension granted shall not be less than one-fifth of the employee’s last drawn salary. (2) For the purpose of subsection (1), the last drawn salary of an employee who retires before being confirmed in his second or subsequent appointment shall be the last drawn salary of his former appointment in which he had been confirmed had he remained in his former appointment until his retirement. (3) Any pension, gratuity or other benefit granted to an employee who retires under section 11 shall be computed in accordance with the regulations where the total period of his reckonable service shall be counted as if he had served until his compulsory age of retirement, whichever is applicable to him. Conferment of pensionable status 6. The pensions authority may confer a permanent employee the status of a pensionable employee if he has— (a) been confirmed in his present appointment; and (b) completed not less than three years’ reckonable service. Statutory and Local Authorities Pensions 9 Exercise of option 6A. (1) An employee appointed on or after the commencement of this section shall, before being confirmed in his appointment, be entitled to opt for the Employees Provident Fund Scheme. (2) The option under subsection (1) shall be made to the appropriate appointing authority in such manner as may be determined by the pensions authority. (3) The exercise of the option by an employee under this section shall take effect on his being confirmed in his appointment and shall thereupon be irrevocable. (4) Where an employee opts for the Employees Provident Fund Scheme, the provisions of this Act, except this section and section 26, shall not apply to such employee. (5) An employee who opts for the Employees Provident Fund Scheme shall retire from the service of a statutory or local authority on attaining the age of sixty years. (5A) Subsection (5) shall not apply to an employee who was appointed before 1 January 2012 and had been given an option before such date and had not opted for the compulsory age of retirement of sixty years. (5B) The compulsory retirement age for an employee who had not opted for the compulsory retirement age of sixty years referred to in subsection (5A) shall remain either fifty-five years or fifty-six years or fifty-eight years as the age that he had opted before 1 January 2012. (5C) The option for the compulsory age of retirement of sixty years exercised by an employee for the purpose of subsections (5) and (5A) shall be irrevocable. (6) An appropriate authority may, with the consent of the pensions authority, require an employee who opts for the Employees Provident Fund Scheme to retire from the service of a statutory or local authority 10 Laws Of Malaysia ACT 239 in any circumstances referred to in paragraphs 10(5)(a), (b), (c), (d), (e) and (f) or section 11. (6A) Notwithstanding subsection (3), an employee who had opted for the Employees Provident Fund Scheme before 1 January 2009 and has been confirmed in his appointment before such date shall be given an option to opt for pension, gratuity or other benefit granted under this Act. (6B) The option made under subsection (6A) shall be irrevocable on 1 February 2009 and the provisions of this Act shall apply to the employee from that date. (6C) Where an employee has opted for pension, gratuity or other benefit pursuant to subsection (6A) and dies before the option becomes irrevocable pursuant to subsection (6B), the employee is deemed to be a pensionable employee and the provisions of this Act shall apply to him from the date of his death. (7) (Deleted by Act A904). Pensionable employee may opt for the Employees Provident Fund Scheme 6B. (1) An employee— (a) who has been conferred the status of a pensionable employee under section 6 or is deemed to be a pensionable employee under paragraph 7(a), (b) or (c); or (b) who was appointed before 12 April 1991 and has not been conferred the status of a pensionable employee, may opt for the Employees Provident Fund Scheme. (2) The option under subsection (1) shall be mad