Amendments to the Employees´ Social Security Act (Act 4) & the Employment Insurance System Act (Act 800)

​On July 22, 2024, the Dewan Negara (Senate) passed two bills from the Ministry of Human Resources relating to the Social Security of Employees and the Employment Insurance Scheme. The Workers' Social Security (Amendment) Act 2024 and the Employment Insurance Scheme (Amendment) Act 2024 (the "Acts") aim to improve social security coverage for Malaysian workers and create a resilient safety net for workers in various sectors.

    

Following the increase in the maximum insurable amount for employees from RM4,000 to RM5,000 per month in 2022, one of the key provisions of the current amendment to the Act is a further increase in the maximum insurable amount to RM6,000 per month. This increase is intended to provide better financial protection to employees and to enhance the protection of Act 4 and Act 800 benefits to ensure the social welfare of beneficiaries in the face of unforeseen circumstances such as job loss or temporary or permanent incapacity.

    

In addition, the Bill provides for the introduction of new contribution rates for cases where an employee's salary exceeds the previous threshold of RM5,000.

  

Furthermore​​, the Employment Injury Scheme (EIS) will continue to apply to employees aged 60 and above. This will ensure that the various benefits provided by the Social Security Organization (SOCSO) to protect workers who suffer an accident at work, such as temporary disability benefits, dependants' benefits and rehabilitation facilities, will continue to be available to workers aged 60 and above.

    

However, this does not apply to the Invalidity Scheme (IS). Here the age limit is 60.

    

The bills are now awaiting Royal Assent and approval in the Official Gazette. They will then come into force on a date to be determined by the Minister for Human Resources through an announcement in the Gazette.