KUALA LUMPUR: The minimum retirement age for private sectors is set to be increased to 60 after the tabling of the new Minimum Retirement Age Bill 2012 in Parliament yesterday.
If passed, the Bill, tabled for first reading by Human Resources Minister Datuk Dr S. Subramaniam, would see the increase of the minimum retirement age for employees in the private sector from the current 55. This will, however, not affect the public sector as the compulsory retirement age for civil servants is set to remain at 56.
The Bill being tabled does, however, give the power to the human resources minister to increase the minimum retirement age without having to table a new Bill in Parliament.
According to the clause, should the minimum retirement age set by the minister not tally with the minimum retirement age of 60, then the minister's powers would mean his decision would supersede the provision in the tabled law.
The Bill also stipulates that any contractual or employment agreements that states a retirement age lower than 60 would be considered null and void. Any private company that terminates their employee on retirement grounds before the age of 60 can face a penalty not more than RM10,000.
It, however, remains unclear whether the new minimum retirement age would affect the minimum age to withdraw savings under the Employee Provident Fund (EPF).
Finance Minister II Datuk Seri Ahmad Husni Hanadzlah refused to comment on the matter when asked after chairing a focus group meeting on enhancing foreign investment, part of the government's preparations for Budget 2013, due on September 28.
Malaysian employees have been for years lobbying for an increase in the minimum retirement age as life expectancy and cost of living have both been rising over the past few years.