What LIFO Means In A Layoff
You want to know why some colleagues were kept while others were let go.
LIFO stands for last in, first out, and it is the standard most Malaysian employers are expected to start from when deciding who to let go during a retrenchment.
What It Means
It means that among employees doing similar work, the most recently hired are usually the first to be selected for retrenchment, on the idea that this is an objective, defensible order.
It is described as a convention, not a rigid law written word for word into the statute, though it carries real weight in how fairness is judged.
Why It Matters To You
An employer is allowed to depart from LIFO, but only where it can point to sound, specific reasons, such as particular skills the business genuinely still needs.1
If the departure looks arbitrary, or lines up suspiciously with personal disputes rather than business needs, that is a detail worth raising if you challenge the retrenchment.
Can Your Employer Skip This Order
Ask directly, in writing, why the selection was made the way it was, since a vague or missing answer is itself useful information about how the decision was reached.
Compare your length of service and role with colleagues who were kept on, and read about retrenchment for the wider process this selection sits inside.
If the answer does not add up, check your 60-day window to challenge it on the deadline calculator.
Telling us who else was retrenched with you, and how long they had each worked there, helps us see if the selection looks fair.
Common questions
Does my employer have to follow LIFO exactly?
It is the conventional starting point, not an absolute rule. An employer can depart from it, but is expected to have a sound, specific reason for choosing who stays and who goes instead.
What if I was newer but kept, and someone senior was let go?
That alone does not prove unfairness, since skills, roles, and performance can justify a different order. It is worth asking what reason was actually given for the departure from LIFO.
Sources
- Last In First Out is the conventional, objective principle for selecting employees for retrenchment, and an employer may depart from it only if it can justify doing so with sound reasons, for a genuine redundancy. Richard Wee Chambers, 5 Points on the Law of Retrenchment in Malaysia
Keep reading
Telling us who else was retrenched with you, and how long they had each worked there, helps us see if the selection looks fair.