In a continuing effort to strengthen Malaysia’s social protection framework, the Employment Insurance System (Amendment) Bill 2025 (“Bill”) was tabled for its first reading in the Dewan Rakyat (House of Representatives) of the Malaysian Parliament on 4 November 2025 to amend the Employment Insurance System Act 2017 (“Act”).  
 
Upon its being passed by the Dewan Rakyat, the Bill will be presented to the Dewan Negara (Senate) and if passed, for Royal Assent. The Bill will become law after it is gazetted and come into operation on a date or dates to be appointed by the Minister of Human Resources.
 
Below are the key highlights of the proposed amendments:

1.	Extension of Coverage to “employment services for any person”

The Bill seeks to extend the scope of the Act to include the provision of “employment services for any person” and to empower the Social Security Organization¹ (“SOCSO”) to provide the following employment services to any person, including casual workers, and gig and platform workers: 

The expression ‘employment brokerage’ means a service to assist any person to find suitable employment and to assist employers to find suitable employees.
 
The Bill further proposes to include the carrying out of the employment services as one of the functions of the Employment Services Officer.
 
To reflect this extension of scope, the Bill proposes to amend the title of the Act to ‘Employment Insurance System and Employment Services Act 2017”.

2.	Duty of employer to notify job vacancy and new position

The Bill also introduces a new section 45F, requiring employers to notify SOCSO in writing about a job vacancy or new position before the hiring of an employee. Where the job vacancy or new position has been filled, the employer shall notify SOCSO in writing within seven days after the job vacancy or new position is filled.

 
An employer who contravenes this requirement shall, on conviction, be liable to a fine not exceeding RM10,000.

3.	Implementation of Active Labour Market Programmes by SOCSO

The Bill authorises SOCSO to implement any programme, scheme, measure or financial assistance relating to the active labour market, if instructed by the Government.

4.	Introduction of Mobility Assistance Allowance

Another key feature of the Bill is the introduction of a mobility assistance allowance, which is defined as a ‘lump sum payment to an insured person to assist the re-employment placement of the insured person who has accepted an offer of employment’.

 
Under the proposed new section 37A, the insured person shall be entitled to a mobility assistance allowance of RM1,000, if: 

5.	Other Enhanced Benefits

The Bill also proposes to enhance the other benefits under the Act by: 

6.	No Recovery of Employer’s Portion of Contribution from Employee

The Bill also clarifies that employers shall only recover an employee’s contributions by lawful deduction from wages and are prohibited from recovering the employer’s portion of contributions from employees. This reinforces the employer’s full responsibility for its share of Employment Insurance System contributions and aims to prevent improper cost-shifting practices or unauthorised deductions.

7.	Application of Public Authorities Protection Act 1948 and Protection against Suits and Legal Proceedings

The Bill will introduce a provision to provide that no action, suit, prosecution or other proceedings shall be brought, instituted or maintained in any court against SOCSO, the Chairman of the SOCSO Board, the Director General and Deputy Director General of SOCSO in respect of any act, neglect or default done or omitted by it or him in the course of carrying out it or his duties under the Act unless it can be proven that the act, neglect or default was done or omitted in bad faith and without reasonable cause.

 
The Bill further provides that the Public Authorities Protection Act 1948 shall apply to any action, suit, prosecution or proceedings against SOCSO, the Chairman and any member of the SOCSO Board, the Director General and Deputy Director General of SOCSO, the Committee or committees established under section 9, Employment Services Officers and officers and servants of SOCSO in respect of any act, neglect or default done or committed by it or him in good faith or any omission by it or him in good faith in such capacity.
 
Comments
 
The Minister of Human Resources, Steven Sim, emphasised that “This Amendment reflects the Government’s continued commitment to ensuring that the nation’s social protection system remains inclusive, sustainable and resilient.”²
 
On the other hand, the Malaysian Industrial, Commercial and Service Employers Association has called on the government to set a clear policy framework and run pilot projects before expanding the EIS to gig and platform-based workers. In a statement, it said, “Before extending the EIS to new labour categories, the government must clarify which workers are covered, how contributions will be shared among workers, platforms and the government, and how the scheme aligns with existing social protection laws to avoid duplication.”
 
In a statement, the Ministry of Human Resources³ said that, “A one-off payment of RM1,000 will be paid under EBM (‘Mobility Assistance Allowance’) if one gets a job which is located at a distance of more than 100km from their home”. As it stands, there is no provision in the Bill which expressly provides for the payment of the Mobility Assistance Allowance for insured persons who are relocated to a job at a distance of more than 100km from their home, although under the Bill, SOCSO can determine the terms and conditions of the entitlement to the Mobility Assistance Allowance.
 
The Bill represents a step toward a more inclusive and proactive employment protection model. As the extension is primarily in respect of the provision of employment services i.e. job matching/  counselling, etc. by SOCSO to all persons including gig and platform workers, there does not appear to be an immediate added burden on employers.
 
In fact, overall, the amendments are expected to create a more resilient labour market, reduce the duration of unemployment, and position SOCSO as an integrated employment service provider. However, its effectiveness will depend on SOCSO’s operational readiness, employer compliance, and the Ministry of Human Resource’s ability to ensure that the expanded programmes deliver measurable outcomes that genuinely support re-employment and workforce development.
 
The Bill can be accessed here.
 
Alert by Foo Siew Li (Partner) and Eunice Soo (Associate) of the Employment Law Practice of Skrine.
 
 

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