Nationwide Movement Restriction in Malaysia: Short Stay Rentals at Stake?

During a live telecast on March 16, 2020 (Monday), Prime Minister, Tan Sri Muhyiddin Yassin has declared that nationwide, Malaysia will be on a restricted movement order. The movement restriction order starting from March 18 to 31, 2020 is an initiative to deal with the rise of Covid-19 cases in Malaysia.

What Type of Public Activities are Restricted?

In the announcement, Muhyiddin ordered a restriction on all public activities which are:

General prohibition on all mass movements and gatherings

  • Applicable to all religious, sports, social and cultural activities.
  • All business and religious premises should be closed.
  • Closure exemption is given to supermarkets, public markets, grocery stores and convenience stores.

Nationwide travel restrictions on all citizens

  • Travelling abroad is prohibited.
  • Malaysians who have just returned from overseas are required to perform a health check & self-quarantine for 14 days.

Entry restrictions on all tourists & visitors to Malaysia

Closure of all kindergartens, public and private schools

Closure of all public and private higher education institution

Closure of all government and private premises

  • With exemption for essential service providers such as water and electricity, telecommunications, postal, transportation, oil, gas, fuel, lubricants, broadcasting, finance, banking, health, pharmacy, fire-fighting, prison, port, airport, safety, defense, cleaning, retail and food supply

Such restrictions will play an essential role in controlling the number of Covid-19 cases. Nevertheless, businesses in various sectors including the short stay sector will be greatly impacted from it. It is a crisis that is beyond the control of the industry players. With the supposing peak season of school holidays kicking in at this period, short stay hosts will be sure to witness a huge drop from the usual bookings and cancellation rates will be at the peak.

Short Stay Rentals at Stake | Malaysia

With travel restrictions taking in place, there will be also be less travelers. This leaves short stay business owners with a great survival struggle. After all, a huge portion of the short stay business relies on the tourism sector. In times like this, you may feel like giving up but you need to remember one thing. – Keep up your fighting spirit! This is not the time to sit back and ponder upon what had been lost. It is the time to be prepared for what is to come.

In line with the current crisis, HostAStay would like to invite all short stay hosts to take part in the Malaysia’s First Short Stay Online Conference. Deep dive into the possible opportunities and challenges with key speakers from the property, hospitality, and technology industry. You can lead the change by adapting to the situation and leveraging upon technology. 

To get things moving before the conference, here are the answers to some of the most common concerns of short stay businesses:

(Disclaimer: Proper legal advice should be obtained.)

Q1: Can I continue to run my short stay business?

The government’s movement restriction order is primarily aimed to reduce large public gatherings. There is currently no specific restriction placed on short stay, long stay or hotel services. While the office will be closed during the movement restriction period, the hosting service will continue to be functional and bookings will continue to be accepted. Having said that, you would anticipate a reduction in bookings during this period.

Q2: Do I need to evacuate an existing foreign customer staying in my unit?

No, it is not compulsory for you to evacuate them, but with the current movement restriction, please advise your customers to stay indoors and order food delivery for their meals. Foreign tourists are also advised to check with their respective embassies whether they can return to their respective countries.

Q3: If I have an existing booking in between March 14th to 31st, can I still allow the guests to stay?

For existing bookings, you may consider continue fulfilling the bookings, but it would be advisable for you to inform customers of the movement restriction order and remind all customers that they should not host large gatherings in the premises.

Customers should also be reminded that they should also refer to the cancellation policy on the booking platforms where they wish to cancel their bookings or change it to another date.

Q4: Is it compulsory for me to provide foreign customers with mask and sanitizer?

No, it is not compulsory for you to provide foreign customers with mask and sanitizer.

Q5: If the situation worsens or my company is highly affected like the travel industry, what can I do?

During this lockdown period, employers are still required to pay the employees’ salary unless the employment contract allows the company to request employees to take unpaid leave. Having said this, employers facing serious financial difficulties may negotiate with employees to consider reducing salary for a specific period, providing more annual leave once business returns to normal, providing other incentives, reducing work hour and workdays or delaying salary payment. Please however note that any reduction of salary must be reported to the Ministry of Human Resources.

 Q6: Can I request my landlord to reduce rent or to stop paying rent during the movement restriction period?

This is subject to the tenancy agreement. If the agreement provides rent-free period for this type of circumstances, then yes, if not, then no. We strongly advice to review the tenancy agreement and to negotiate with landlord.

Q7: Can I request my staff to take annual leave during the movement restriction period announced by the government?

No, the 14 days movement restriction period is mandated by the government. Employers are not allowed to deduct employees annual leave.

Q8: Can I propose to employees to delay the salary payment or change their monthly salary to a bi-weekly salary?

The employer may suggest to employee but they cannot force the employee to accept. Employers should consider negotiating with employees to reach an agreement.

Q9: Can I reduce employee’s salary at this period?

Yes, provided that employees agree to it. But, the reduction of salary must be done at all level and the amount to be reduced must be fair. Proper legal advice must first be obtained before enforcing reduction of salary and any reduction of salary must be reported to Ministry of Human Resources, failing which it is an offence.

Q10: What should I do if an employee agrees to reduce pay or to delay their salary payment?

The employer must issue proper documentation to employee and employee must sign to acknowledge the special arrangement made.

Q11: Do I have to continue to make all statutory contributions such as EPF and SOCSO?

At the moment, yes. But it may subject to changes with pending further government announcements.

How to Move Forward?

Perhaps, with this crisis, we could take a learning or two from it and derive what the future may hold for the short stay industry. What if we tell you that you can regain your momentum in this difficult time?

Yes, you can! Redefine the short stay strategies with confidence through exclusive insights from industry professionals. Save the date for Malaysia’s First Short Stay Online Conference. If you are looking to turn the crisis into an opportunity, then this is a must-attend virtual event for you and your partners.

Gain all the insights you need from the comfort of your home. Early Bird tickets are now available till 26th of March.

Malaysia's First Short Stay Online Conference



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