Work in Malaysia – Country Profile

Country profile

Malaysia is quite literally a country of two halves, with its component land masses – Peninsular Malaysia (which lies on the Malay Peninsula) and East Malaysia (on the island of Borneo) – separated by the South China Sea. A former British colony which gained independence in 1957, the country consists of 13 states and three federal territories governed by a democratic parliament with an elected king, the Yang di-Pertuan Agong, as head of state. Every five years, the monarch is elected from the hereditary rulers of the Malay states.

Culture

Malaysia is a genuinely multi-ethnic and multi-cultural country, and this diversity has a profound impact on the politics of the state. The political landscape owes a lot to the British parliamentary system, while the constitution acknowledges Islam as the state religion but enshrines in law the freedom to practice other religions. The majority of people in Malaysia are ethnic Malays, but there are also large Chinese and Indian communities.

Popular activities

Malaysia’s stunning coastline with its warm, clear water is the setting for a range of watersports. Outdoor activities such as hiking, cycling and fishing are also popular, while golf is a growing sport for both participants and spectators. The country’s world-renowned spa resorts are a popular venue for socialising, while cities like Kuala Lumpur boast a thriving food scene. Malaysia also has several traditional games and pastimes which are still enjoyed today, with kite (or wau) flying and silat (a form of martial arts) demonstrations a regular sight around the country. Another social attraction is the simple sport of sepak takraw, a game in which players form a circle and try to prevent a small ball from dropping to the ground without using their hands.

Food and drink

Malaysian cuisine strongly reflects the country’s diverse ethnic makeup, with Indian, Chinese and Thai influences clear alongside the Malay classics. Rice remains the staple food, with seafood, beef and poultry also featuring heavily on menus. Unlike some Muslim countries, there are few restrictions on the sale of pork. Characteristic flavours of Malaysian cuisine include chilli, ginger, coconut, soy and satay. Drinks tend to be sweet and somewhat syrupy in nature, for example tea and coffee are usually served with condensed milk. Coconut milk-based drinks are also popular. Alcohol is widely sold although drinking on the street is illegal.

Languages

The official language is Malay, which is widely-spoken across not only Malaysia, but Indonesia, Brunei and Singapore as well. English is also widely taught and spoken, largely as a result of past colonial rule. A derivative form of Standard English known as Malaysian English, and the more colloquial Manglish – a creole-type spoken language with Malay, Chinese and Tamil influences – are the most common forms. Other important languages include the various dialects of Chinese spoken by the large Malay Chinese population.

Weather

Malaysia has a tropical climate, with hot and humid conditions typical and air-conditioning a must. While there is a degree of variation, average temperatures are around 27°C (80°F), with coastal areas generally a bit warmer and the forest and mountain regions a little cooler. Rainfall is fairly consistent all year round, with only a slight increase between October and April. However, the exception is the wet season experienced by Peninsular Malaysia’s east coast between December and February. During this time many east coast tourist resorts close, but the west of the country is unaffected. Malaysia can also experience typhoons – usually between July and November – so ensure that you are aware of emergency plans in your area.

Safety and security

With its strict criminal justice system, Malaysia has low levels of violent crime. Expats are far more likely to be affected by scams like credit card fraud. Bag snatching and robberies are more prevalent in cities, so always be aware of your surroundings and try to avoid walking alone. Malaysia does experience sporadic political and social unrest, so avoid travelling to disputed areas of East Malaysia and try to stay clear of any public demonstrations.

As with any new country, you should make sure you are aware of local laws. Malaysia has a particularly strict attitude towards drug crimes, with drug trafficking carrying a mandatory death penalty and possession a lengthy custodial sentence. Homosexual acts are also illegal.

System structure

Education in Malaysia is primarily the responsibility of the Ministry of Education, although each state also has a local education authority which can operate with a degree of autonomy. The system consists of six years of primary school for children aged 7 to 12 and five years of secondary school for those aged 13 to 18, followed by an optional sixth year of secondary school and potentially higher education at university.

Academic year

The Malaysian academic year runs from January to November, with each state authority determining the exact dates. Most schools operate a two-term system: the first from January to May with a holiday during March and the second from June to November with a break in August. State schools tend to start before 8:00am and finish soon after lunch for compulsory sports or other extracurricular activities, but private and international schools may keep different hours. International schools may also operate term dates more akin to their parent country.

Higher education

Higher education in Malaysia is growing due to ambitious targets and generous funding on the part of the state. Malaysia has recently attracted several world-renowned universities to set up international campuses in the country, resulting in three major types of university:

• Public institutions of higher education – state-run and publically funded institutions which can be further categorised as research, comprehensive or focused institutions
• Private institutions of higher education – institutions established by private sector companies with the backing of the Ministry of Education’s Department of Private Education
• Foreign university branches – universities that are part of an institution based in another country

Some Malaysian higher education establishments also have ‘twinning’ agreements with foreign universities to enable students from both institutions to take part of their course at each university. Malaysian students require a Malaysian High School Certificate to gain entry to university, but other international qualifications will be considered for foreign nationals.

Funding

The Malaysian government offers generous subsidies for higher education so while Malaysians who study at public universities do pay tuition fees, the cost is greatly reduced compared to students at private institutions who usually pay full fees. There are also a number of public and private sector scholarship and loan schemes for Malaysians and international students. For more information, visit the Ministry of Education website.

Courses

The choice of university courses in Malaysia is vast, with undergraduate and postgraduate courses available at most institutions. Course durations and assessment types depend on what kind of university it is, as international institutions tend to follow the structure of their parent system. Applications are usually made directly to the individual university, but websites like Study Malaysia enable prospective students to search more broadly for courses.

Research

Research opportunities are gradually increasing in Malaysia and funding is available from several public and private sources. The Department of Higher Education is a good place to start, but it is worth doing some homework as many funding bodies are specific to a particular subject or niche.

Primary and secondary education

Although there are many different types of school in Malaysia, the majority fall into one of three categories: public schools, private schools and international schools. Qualifications are laid out by the Malaysian Qualification Framework, although international schools usually offer foreign equivalents. Public schools are free to Malaysians and do allow some access for the children of foreign nationals, but the language barrier and differences in curriculum mean that many prefer their children to go to the more expensive private or international establishments.

Preschool and childcare options

Although preschool is not compulsory in Malaysia, it is popular and so access to Ministry of Education preschools is restricted to Malaysian families only. However, there are plenty of privately-owned nursery and preschool options for foreign nationals, as well as a considerable number of private nannies who can be employed at a fairly reasonable cost.

Geographical variation

The cost of living in Malaysia is considered to be very low compared to neighbouring countries such as Singapore, although major cities like Kuala Lumpur and Penang can be pricier. Many people assume that the cost of living in Peninsular Malaysia will be higher than in East Malaysia, but this tends not to be the case due to a controversial cabotage policy designed to benefit the Malaysian shipping industry. Although successful in this respect, the reduced competition has led to higher prices in East Malaysia.

Accommodation

Lease agreements in Malaysia are typically two year contracts, so it is recommended that foreign nationals have a so-called ‘diplomatic clause’ written in to allow them to terminate early should they leave the country. Rents can be very reasonably priced, but you may pay a premium if you choose a short-term let. Be aware that the term ‘unfurnished’ in Malaysia can be very literal, with unfurnished properties sometimes even rented without kitchen equipment!

If you wish to buy a property in Malaysia, there is certainly no shortage of choice. In the past, Malaysia restricted the rights of foreign nationals with regards to purchasing property. Today, these restrictions have largely been removed and the Malaysian government actively encourages foreigners to invest in property by offering incentives through the Malaysia My Second Home (MMSH) scheme. There may still be a minimum property purchase value which applies to foreigners, and deals are subject to approval by the state authorities, which can take up to six months.

Rental deposit

Tenants are frequently asked to pay several rental deposits in Malaysia. Firstly, you pay an earnest deposit of one month’s rent to reserve the property, although this payment is usually taken as the first month of rent in advance. The security deposit is usually two months’ rent, while some landlords will also ask for a utilities deposit of between half and one month’s rent.

Council tax

Locally-levied property taxes in Malaysia are known as Local Council Assessments. Although significantly cheaper than in many European countries, these rates do vary between states, so make sure you check the local government website for details.

Utilities

The cost of utilities in Malaysia can be surprisingly high compared to the rents. Water and electricity supplies are administered by local companies or authorities, while mains gas supplies are only available in Peninsular Malaysia. The majority of properties use bottled gas, which is heavily subsidised. For telephone and internet providers there is more choice, so shop around for the best prices.

TV licence

Malaysia no longer has a TV licensing system, so terrestrial channels are free to view. However, not all of these are available in East Malaysia, and paid satellite services like Astro are increasingly popular.

Healthcare and medical costs

The Malaysian healthcare system is a combination of public and private services. Although there are some exceptions, in general only Malaysian citizens or permanent residents (holders of the MyKad and MyPR identity cards) can access state-funded healthcare, which is why foreign nationals are usually required to have private medical insurance. Foreigners who are employed by a Malaysian company may have access to public services but will usually have to pay treatment charges, although some services may be covered by the employer-funded Foreign Workers Hospitalisation and Social Insurance Scheme (SKHPPA).

Shopping

With the temperate climate providing good farming conditions, many fresh foods can be sourced locally in Malaysia and therefore prices remain quite low, with the exception of imported good in East Malaysia. Foodstuffs are also subsidised, so the grocery shop can be done quite cheaply. Clothing and other everyday purchases can also be made relatively inexpensively.

Goods and services tax

Malaysia currently charges two types of sales and service taxes, but a new goods and service tax system is scheduled for implementation in 2015. For more information visit the Royal Malaysian Customs Department’s Goods and Services Tax website.

Price guide

• Rent on 1-bedroom apartment in city centre – MYR1,570.22 (≈£290.99) per month
• Rent on 1-bedroom apartment outside city centre – MYR841.79 (≈£156.00) per month
• Price of apartment in city centre – MYR6,830.00 (≈£1,265.74) per square metre
• Price of apartment outside city centre – MYR4,027.44 (≈£746.37) per square metre
• Loaf of bread – MYR2.97 (≈£0.55)
• Milk (1 litre) – MYR5.73 (≈£1.06)
• Bottled water (1.5 litre) – MYR2.17 (≈£0.40)
• Draught beer (0.5 litre) – MYR10.00 (≈£1.85)
• Packet of cigarettes – MYR12.00 (≈£2.22)
• Petrol (1 litre) – MYR2.07 (≈£0.38)
• Cinema ticket – MYR12.00 (≈£2.22)

Source: www.numbeo.com (accessed July 2014)

 Budgeting and savings

For money saving tips and budgeting advice, as well as the best deals on a range of relocation costs, consult a Malaysian consumer website such as SaveMoney.my.

Driving

The road system in Peninsular Malaysia is modern and well-maintained, with an extensive highway network providing road links to Thailand and Singapore. East Malaysia’s roads are less modern and can be poorly maintained in places, but are also less well travelled and often less congested. In Malaysia, vehicles are driven on the left-hand side of the road – a legacy of British colonial rule. Driving standards can be poor, particularly in the cities where congestion is at its highest, so some expats prefer to stick to public transport.

Diesel and petrol costs are subsidised so running a car can be fairly cheap, however vehicles are expensive to purchase. To drive a car in Malaysia you must be aged 17 or over, although you can ride a motorcycle at the age of 16. For any vehicle, you must have valid road tax and insurance as well as a driving licence as the penalties for driving without these items are severe. Foreign nationals may be allowed to drive on their home country licence for up to three months before they must exchange it for a Malaysian one. For more information, contact the Road Transport Department Malaysia.

Taxis

There is no shortage of taxis in Malaysia, however they do have a reputation for being expensive in comparison with other public transport options. This is not always the case, but if you do choose to take a taxi then check whether or not it is metered before starting the journey. If it has no meter, make sure you negotiate a price upfront to avoid being overcharged.

Buses and coaches

Local and national bus and coach services remain a popular way to get around in Malaysia, with most major cities and some rural areas operating services at fairly low cost. Long-distance coach companies also operate routes to Thailand, Singapore and Brunei.

Trains

Peninsular Malaysia has a fairly extensive railway network, with a range of freight and passenger services linking major cities within Malaysia as well as providing international routes to Thailand and Singapore. The government has invested heavily in modernising the railways and the result is a fairly comfortable and inexpensive way to travel. The main train operator is KLIA Ekspres and the best priced tickets are usually available online. In East Malaysia, train transport is far less well-established with only the state of Sabah running services.

Trams and light rail

Several cities in Malaysia have trams or light railways systems to alleviate pressure on the roads. For example, Kuala Lumpur has two light rail lines, a monorail and an airport rail link operated by MyRapid.

Air travel

Malaysia has several commercial airports, although the majority of international services are focused around the major hubs of Kuala Lumpur International Airport, Kota Kinabalu International Airport and Penang International Airport. Despite being relatively expensive, domestic air travel is important for reaching the more remote regions and for linking Peninsular Malaysia to East Malaysia. Malaysia Airlines is the flag carrier and operates both international and domestic routes, while competition is increasing from budget airlines like AirAsia.

Other ways to get around

Many foreign nationals are surprised to learn that there are no regular ferry routes between Peninsular Malaysia and East Malaysia. That said, sea transport is important to the South China Sea region and major Malaysian ports link the country to Indonesia, the Philippines, Brunei, Singapore and Thailand. Boat services are also important for reaching outlying Malaysian islands, while there are also several hundred kilometres of canals and inland waterways spanning the country.

Working hours

Under Malaysian employment law employees are entitled to at least one day off per week, with the maximum standard working week set at 48 hours over six days, although many businesses work 40 hours over five days. Typical business hours are Monday to Friday from 9am to 5pm, although in some areas different working structures are common due to religious considerations.

Holidays

The majority of people working in Malaysia are entitled to at least eight days of paid annual leave each year, with this allowance rising annually by length of service. Paid sick leave and maternity leave of no less than 60 days are also defined by Malaysian law.

Public holidays

Because if its multiculturalism, Malaysia has a generous allocation of public holidays, with around 14 dates observed nationally each year and various additional state holidays celebrated around the country. Most employees are entitled to at least ten public holidays as paid leave. For a more comprehensive guide to holiday dates, including state lists and explanations of the law surrounding public holiday allowances, visit the Public Holidays Malaysia website.

Public holiday dates

2019

New Year’s Day: January 01

Federal Territory Day: February 01

Chinese New Year: February 16

Labour Day in Malaysia: May 01

Wesak Day (Buddha’s Birthday): May 19

King’s Birthday Malaysia: September 09

Hari Raya Puasa (End of Ramadan): June 05

Merdeka Day (National Day): August 31

Hari Raya Haji (Festival of Sacrifice): August 12

Awal Muharram (Islamic New Year): September 01

Deepavali (Festival of Lights): October 27

Christmas Day: December 25

Visas and eligibility to work

Citizens of many nations are allowed to visit Malaysia for between 30 and 60 days without applying for a visa beforehand. However, this should not be mistaken for relaxed immigration laws – although a fairly small number of nationalities require a visa to visit Malaysia the law surrounding living and working there is much more complex. Note that the list of nationalities that require employment visas is different to those who need visitor visas.

In some sectors, Malaysian businesses are restricted in the number of foreign nationals they can employ, so for this reason it is important to have a job offer before applying for Malaysian visas or work permits. There are several types of employment pass which may be issued to foreign workers depending on work type and the duration of stay, so contact your employer for more information. Foreign nationals who have lived in Malaysia for more than 3 years may be able to apply for permanent residency or citizenship through various schemes. Be aware that all permanent residents must have a MyPR identity card, while citizens must hold a MyKad equivalent. Foreign nationals who plan to retire to Malaysia could also consider applying for the Malaysia My Second Home (MMSH) scheme.

Tax and insurance

Income tax rates in Malaysia are fairly low compared to many countries, with top earners taxed at under 30%. Most employers deduct tax directly from your wages, so you will need to apply for a tax number. For tax purposes, anyone who remains in the country for over 182 days is considered a resident. If you work in the country for a shorter period then you will either be tax exempt or be taxed at non-resident rates. Malaysian citizens are required to make social security contributions through a scheme known as PERKESO or SOCSO. Non-resident workers are not covered by this scheme, but are instead insured by their employer through the Foreign Workers Hospitalisation and Social Insurance Scheme (SKHPPA). For more information, visit the Inland Revenue Board of Malaysia website.

Pensions

The mandatory pension system in Malaysia is called the Employee Provident Fund (EPF). Contributions are compulsory for Malaysian citizens but not for foreign nationals. Although foreign workers can now opt in to the EPF, there are still restrictions on withdrawals for foreigners, so many choose to take out private pensions instead. Some employers do offer pension schemes, but this is less common among Malaysian businesses.

Benefits

Despite major improvements in the overall system in recent years, foreign nationals living in Malaysia still have little or no access to state benefits unless they take Malaysian citizenship. You may however be entitled to claim benefits in your home country.

Disability

The rights of disabled workers in Malaysia are defined under the Persons with Disabilities Act 2008, with employers legally obliged to promote access to the workplace for disabled people.

Organisational structure

Malaysian organisations can be quite diverse, with Malaysian, Chinese and Indian business cultures all holding significant influence. The result is a tendency towards hierarchical structures with rank and position important and decisions made at the top. However, Malaysians generally take quite a consultative approach and may seek a consensus of opinion within the business before making a final decision – so the process is not always the quickest.

Management style

As in many hierarchical business cultures, managers in Malaysia are sometimes viewed as parent figures by their employees, so it is not uncommon for managers to take an interest in the home and family lives of their staff. However, there remains a clear line of demarcation between the ranks, and interest does not typically represent friendship. The concept of maintaining face is important in Malaysia, so managers will usually avoid criticising their staff publicly and team members are usually very loyal to their managers. This unwillingness to lose face can be an obstacle in a collaborative environment though as people may be afraid to contribute an idea that is later rejected.

Formality

Although internationally aware and business-savvy, Malaysians are generally quite formal and polite, especially with unfamiliar people. Address contacts by their title and surname where appropriate, but be aware that many ethnic Malays use patronyms rather than surnames. In these cases you should address people by title and first name. If in doubt, take an interest and ask people how they prefer to be addressed.

Relationships

It takes time to develop trust with contacts in Malaysia, so don’t be surprised if early meetings appear unproductive. You may find people initially reserved, but small talk about neutral topics and time spent in each other’s company can really help to develop the rapport you need to work together.

Dress code

As a predominantly Muslim country, Malaysia has quite a conservative dress code. Men should wear a dark-coloured suit, a long-sleeved shirt and a tie, while women may wear skirts, trouser suits or dresses providing that they are modest. Revealing clothes are inappropriate. Malaysian women tend to wear garments that fully cover their body and headscarves are common, so make sure that you clothing choices will not make anyone else feel uncomfortable.

Greetings

To show respect for people’s position within the hierarchy, try to greet the most senior people in a room first. Business people in Malaysia usually shake hands with each other, but depending on the culture and beliefs of different groups, it may not be appropriate to shake hands with female contacts. If a female contact does not offer to shake hands, a brief nod or slight bow is a polite alternative.

Punctuality

When working in Malaysia you will find that face is more important to local people than time. Many Malaysians would rather miss deadlines than put pressure on people to deliver. If you have a deadline that is paramount, you must keep reiterating it in a calm and polite manner. It is important to arrive at meetings on time, but don’t be surprised if you are then asked to wait because another meeting has overrun – Malaysian people find it hard to put an abrupt end to proceedings.

Meetings

Business cards are usually presented by the visiting party at the beginning of a meeting. When receiving or presenting a card, hold it with both hands. When accepting a card, ensure that you take a moment to look at it before putting it away. Malaysian business meetings can be rather formal so it’s best to have a clear agenda worked out beforehand. Patience is certainly a virtue, as many Malaysians will pause for 20 to 30 seconds before answering a question. Don’t mistake this for an invitation to continue speaking – they are showing respect for the question by giving it due consideration before answering, and you should do the same. When negotiating, summarise frequently and always clarify details afterwards. Written contracts are not always considered the end of negotiations, with changes still occurring after agreements appear to have been reached.

Cultural sensitivity

Always be mindful of the concept of face as it will affect and inform your relationships with Malaysian contacts. Putting someone on the spot, showing anger, refusing a request or giving an outright refusal are all considered quite rude. As a general rule, remain calm at all times and be respectful of the people around you to ensure success.

Business language

Although Malay is the official language, English is widely used in business settings. Depending on the region and the nature of your business, you may also find Chinese dialects or languages from the Indian subcontinent in use, so check ahead to find out if translation will be required.