SOCSO is mandated to both administer and enforce the following Acts:
- Employees’ Social Security Act 1969 (Act 4), and the
- Employees’ Social Security General Rules 1971.
And subsqeuent updates, with the:
- Self-Employment Social Security Act 2017 (Act 789), and the
- Employment Insurance System Act 2017 (Act 800).
The Employment Injury Scheme and the Invalidity Scheme under Act 4 empowers SOCSO to provide free medical treatment, facilities for physical or vocational rehabilitation, and financial assistance to employees if the accidents or diseases have reduced their abilities to work or rendered them incapacitated. If an employee dies, his/her dependents are provided for financially through pensions.
Foreign workers are also covered under Act 4, while self-employed individuals are covered under the subsequent Act 789. These groups are only eligible for the Employment Injury Scheme.
Coverage of the Workers Social Security Act 1969
Employers are required to pay monthly contributions for each eligible employee according to the rate specified under the Employees’ Social Security Act, 1969. These contributions are divided into two (2) types, namely:
Contributions of the First Category
For employees who are less than 60 years of age, contributions payable by employers and employees are for the Employment Injury Scheme, and the Invalidity Scheme.
The rate of contribution under this category comprises 1.75% of the employer’s share and 0.5% of employees’ monthly wages according to the contribution schedule.
Note: All employees who have not reached the age of 60, must contribute under the First Category except for those who have attained 55 years of age and have no prior contributions before they reach 55 due to non-eligibility under the Employees’ Social Security Act, 1969.
Contributions of the Second Category
The rate of contribution under this category is 1.25% of employees’ monthly wages, payable by the employer, based on the contribution schedule. All employees who have reached the age of 60 must be covered under this category for the Employment Injury Scheme only.
Note: For eligible new employees who are 55 years of age, they must be covered under the Second Category.
For more information, visit the PERKESO website
Frequently Asked Questions
What is the purpose of SOCSO?
The purpose of SOCSO is to provide a social security protection for employees.
Is SOCSO compulsory?
SOCSO is compulsory for all Malaysian employees with monthly salaries less than RM3,000. SOCSO is optional for those with salaries above RM3,000
