A new wage ceiling has been enforced by the Human Resources Ministry through the Social Security Organisation (SOCSO effective 1 September 2022 for employees who earn RM4,000 to more than RM5,000 a month.

The contribution amount that applies to employees with salaries exceeding RM4,000 per month is stated in the Workers’ Social Security Act 1969 (Act 4) and the Act Employment Insurance System 2017 (Act 800).

As per the Press Statement, the benefits that employees can appreciate are such as Temporary Disability Benefit (FHUS), Permanent Disability Benefit (FHUK), Dependent’s Benefit (FOT), disability pension as well as pension in case of death for surviving nominee under Act 4 as well as Jobseeker’s Allowance (EMP), Reduced Income Allowance (EPB) and Early Reemployment Allowance (EBSA) under Act 800.

The Rate of Contribution from the employer and employees summing up to the total contribution for different wages can be found at the link HERE.

Rate of Contribution for Employees’ Social Security Act 1969 (Act 4)

Rate of Contribution Employment Insurance System (Act 800)

According to SOCSO’s Chief Executive Dato’ Sri Dr. Mohammed Azman Aziz Mohammed, this initiative will enhance SOCSO’s social security coverage by increasing the existing interest payment rate up to 25.3%.

For employees with salaries exceeding RM5,000 per month, the contribution amount is subject to the wage ceiling of RM5,000. Accordingly, the contribution payment for the month of September 2022 and the subsequent months shall be made by the employer according to the new wage ceiling.

“Starting this September, the contribution amount that will apply to employees with a salary exceeding RM4,000 per month is as stated in the Third Schedule, Act 4 and the Second Schedule, Act 800.”

The contribution amount will be determined by the salary ceiling limit of RM5,000 for employees whose monthly salaries are more than that amount, he said in a statement on Wednesday (Aug 31).

It is Socso to enforce a new salary ceiling limit that there will be 1.5 million employees, both foreign and local, which is 19% of all SOCSO contributors, involved in the following salary ceiling increase. Since the establishment in 1971, the salary ceiling has been increased five times to date.