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Are you being laid off?

There is a difference between Termination, Dismissal, VSS, MSS and Retrenchment. A loosely used term may be confusing and may cause unwarranted issues.

Termination means any kind of action taken by employee or employer to end their employment contract. It includes resignation, abscondment, dismissal or even retirement.

Dismissal on the other hand is normally an outcome from a misconduct where the employee is asked to leave the company for their wrong doing. It's normally done after an Inquiry.

A VSS or voluntary separation scheme is offered as a measure to cut down operations costs or close down of a specific department, and may be offered for willing employees to apply and leave the company voluntarily.

MSS, mutual separation scheme, is typically meant for a targeted team or specific member of the team. Usually with a mutually agreed severance package after a negotiation process. Time and again MSS is done because a specific position or role is no longer needed.

Retrenchment is an exercise done as a last resort when a company is required to make a huge cut in its headcount. Normally due to adverse economic impacts, loss of business, sales and revenue.

Apart from normal terminations, VSS and Retrenchment typically requires a planned communication and prior notification to the Malaysian Labor Department.

Learn more about our HR Consultancy and Trainings on Employment Laws, Terminations and Separation Schemes, email us at:


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