Published On: 18/03/2026By

Is the Additional Hari Raya Public Holiday Compulsory for Private Sector Employers in Malaysia?

Following the announcement by Prime Minister Anwar Ibrahim, many employers are asking an important compliance question:

Is the additional Hari Raya public holiday compulsory for private sector companies?

The short answer is yes.

Legal Basis: Holidays Declared Under the Holidays Act 1951

The additional public holiday for Hari Raya Aidilfitri is declared under Section 8 of the Holidays Act 1951.

This provision gives the Malaysian Government the authority to declare additional public holidays when necessary.

Once declared, the holiday becomes officially gazetted and legally binding.

Is the Holiday Mandatory for Private Sector Employers?

Yes.

When a public holiday is declared under Section 8:

✔ It becomes a compulsory public holiday nationwide
✔ It applies to all employers, including private sector companies
✔ It applies even to companies that do not normally observe all gazetted public holidays

In simple terms:

👉 Employers cannot opt out of this declared public holiday

This is an important clarification, especially for SMEs that follow selected public holidays only.

Employer Obligations: What You Must Do

Under Malaysian labour law, employers are required to take action once the holiday is officially declared.

Employers must:

✔ Grant the public holiday to employees
OR
✔ Compensate employees accordingly if they are required to work

These obligations fall in line with the provisions under the Employment Act 1955, particularly on public holiday entitlements.

If Employees Are Required to Work

If business operations require employees to work on the declared public holiday, employers must ensure proper compensation:

✔ 2× Ordinary Rate of Pay (ORP) for public holiday work
✔ 3× Hourly Rate of Pay (HRP) for overtime on that day

Failure to comply may expose employers to labour disputes or non-compliance risks.

Can Employers Substitute the Public Holiday?

Yes.

Employers may choose to replace the declared public holiday with another working day, provided that:

✔ Employees are clearly informed in advance
✔ The substitute day is treated as a paid public holiday
✔ The arrangement is properly documented

This is especially relevant for businesses with:

  • Shift operations

  • Continuous production schedules

  • Customer-facing services

HR Advisory: Plan Early to Avoid Compliance Issues

With two possible dates (20 or 23 March 2026) depending on the Hari Raya announcement, HR teams should:

📌 Monitor the official confirmation date
📌 Update internal holiday calendars
📌 Communicate clearly with employees
📌 Adjust payroll settings for public holiday calculations

Early planning helps prevent:

  • Payroll errors

  • Employee dissatisfaction

  • Compliance risks

How Pandahrms Helps Employers Stay Compliant

Managing public holiday changes manually can be complex, especially during festive periods.

With Pandahrms, employers can:

✔ Automate public holiday pay calculations
✔ Track attendance for holiday work
✔ Apply correct overtime rates automatically
✔ Manage leave and workforce planning efficiently

This ensures your company remains compliant while reducing HR workload.