Dewan Rakyat passes Employees’ Social Security (Amendment) Bill 2022

The Dewan Rakyat (House of Representatives) of the Malaysian Parliament passed the Employees’ Social Security (Amendment) Bill 2022 (‘the Bill’) on 21 July 2022 to amend the Employees’ Social Security Act 1969.
Amendments passed include increasing the maximum limit of the insurability amount of wages of an employee from RM 4,000.00 to RM 5,000.00, which would have the effect of improved protection for employees earning RM 5,000.00 and above as a result of higher contribution rates.
In tandem with this, amendments have also been passed to introduce new contribution rates under Third Schedule (Rates of Contribution) for contribution for Invalidity and Employment Injury (First Category - paid by both Employee and Employer) and contribution for Employment Injury (Second Category – paid wholly by Employer) when wages of an employee exceed RM 4,000.00 and RM 5,000.00 respectively as well introducing new contribution rates and corresponding assumed monthly wage under the Fourth Schedule (Disablement Benefit and Dependants’ Benefit) for the month when wages of an employee exceed for RM 4,000.00 and RM 5,000.00 respectively.
The Bill will now be presented to the Dewan Negara (Senate) and if passed, to the Yang di Pertuan Agong for Royal Assent, whereafter the law will be gazetted and come into operation on a date to be appointed by the Minister of Human Resources by notification in the Gazette.
Alert by Sara Lau (Partner) of the Employment Law Practice of Skrine  

This alert contains general information only. It does not constitute legal advice nor an expression of legal opinion and should not be relied upon as such. For further information, kindly contact