Malaysia
Employment Insurance System (Amendment) Bill 2025 passed
Impact date: Passed by Dewan Negara in March 2026; commencement awaited The Employment Insurance System (Amendment) Bill 2025, which had earlier been passed by the Dewan Rakyat, was passed by the Dewan Negara in March 2026. The amendments are intended to strengthen Malaysia’s Employment Insurance System, including through improved benefits and the introduction of a Mobility Assistance Allowance for eligible jobseekers. The Bill had previously attracted employer concern due to proposed obligations around vacancy notifications, and the Government had indicated that aspects of the Bill would be reviewed before Senate tabling.
As at this update, the Bill should continue to be monitored for Royal Assent, gazettement and commencement.
Employer implications/action needed Employers should monitor commencement and any implementing guidance, particularly on any obligations affecting retrenchment, loss-of-employment processes, vacancy notification / job matching requirements, and employee guidance on EIS benefits.
Employer risk No immediate operational change should be assumed until commencement is confirmed. Once in force, non-compliance with any employer obligations may result in regulatory exposure.
Link
List of Bills on Parliament website: https://www.parlimen.gov.my/bills-dewan-rakyat.html?uweb=dr&lang=en#
Employees’ Social Security (Amendment) Act 2026 gazetted
Impact date: Gazetted 5 March 2026; expected implementation from June 2026 The Employees’ Social Security (Amendment) Act 2026 was gazetted on 5 March 2026. The amendments introduce a new non-employment injury protection scheme, commonly referred to as “Skim Kemalangan Bukan Bencana Kerja” / “LINDUNG 24 Jam”, extending SOCSO-related protection to certain accidents occurring outside the course of employment.
PERKESO’s FAQ states that the new contribution schedule covering the employee’s share for the LINDUNG 24 Jam scheme is expected to take effect from 1 June 2026. The scheme is funded through employee contributions, with employers responsible for making the salary deductions and remitting the contributions to PERKESO. The FAQ states that contribution payments for June 2026 are due by 15 July 2026, and that PERKESO will provide a six-month grace period after implementation during which employers will be exempted from penalties or legal action for non-compliance with the LINDUNG 24 Jam contribution requirement.
Employer implications/action needed Employers should update payroll systems and contribution processes to accommodate the new employee contribution for LINDUNG 24 Jam. HR/payroll teams should also prepare employee communications explaining the new deduction, confirm whether payroll vendors are ready, and ensure contributions are remitted within the applicable monthly deadlines.
Employer risk Failure to make the required deductions and remittances may result in regulatory action or penalties, although PERKESO’s FAQ indicates that a six-month grace period will apply after implementation for the LINDUNG 24 Jam contribution requirement.
Link
Employees’ Social Security (Amendment) Act 2026: https://www.maicsa.org.my/media/11155/technical_announcement_260310_1_1.pdf
Gig Workers Act 2025 comes into force
Impact date: 31 March 2026 Malaysia’s historic Gig Workers Act 2025 came into force on 31 March 2026. This marks the commencement of Malaysia’s first standalone statutory framework regulating gig work and platform operators, including registration requirements, contractual protections, minimum standards, social security coverage, dispute resolution mechanisms and the establishment of a Gig Workers Council.
Employer implications/action needed Platform operators and other parties engaging gig workers who fall within the scope of the Act should review their gig worker contracts, payment practices, onboarding/offboarding procedures, deductions, social security arrangements and dispute handling processes to ensure compliance with the Act.
Employer risk Non-compliance may result in claims, regulatory action and penalties. The Act provides for penalties of up to a fine of RM50,000, imprisonment of up to two years, or both.
Link
Gig Workers Act 2025: https://jtksm.mohr.gov.my/sites/default/files/2026-01/Act%20872%20-%20GIG%20WORKERS%20ACT%202025.pdf
Revised Employment Pass salary policy
Impact date: 1 June 2026 Malaysia’s Expatriate Services Division has announced a revised Employment Pass salary policy effective 1 June 2026. The revised thresholds apply to all new and renewal Employment Pass applications submitted on or after 1 June 2026. The new minimum salary thresholds are:
- Category I: RM20,000 and above
- Category II: RM10,000 to RM19,999
- Category III: RM5,000 to RM9,999
The revised policy also introduces a structured employment duration framework. Category I passes may be granted for up to ten years. Category II passes may be granted for up to ten years with a succession plan. Category III passes may be granted for up to five years with a succession plan. The FAQ confirms that the salary requirement is based on basic salary only, excluding allowances or other payments.
Employer implications/action needed Employers should urgently review existing and planned expatriate arrangements, especially renewal timelines and employees currently below the new thresholds. Employers should also review employment contracts, salary structures, budgeting, and succession planning requirements for Category II and III roles. Where possible, renewal applications should be planned around the transition rules.
Employer risk EP applications or renewals submitted on or after 1 June 2026 may be rejected if the revised salary thresholds or other policy requirements are not met. This may affect work authorization, business continuity, dependent pass arrangements and expatriate workforce planning.
Link Expatriate Services Division website: https://esd.imi.gov.my/portal/latest-news/announcement/announcement-266-ep-salary-policy-2026/
KESUMA one-stop labor centres established / expanded
Impact date: Ongoing The Human Resources Ministry’s one-stop labor centre initiative has progressed beyond the earlier pilot proposal. The initiative is intended to consolidate key Human Resources Ministry services under one roof for workers, employers and unions, including labor, industrial relations, Industrial Court, trade union and social security-related services. Public reports indicate that pilot centres had been established in Penang, Kuala Lumpur, Johor Bahru and Kota Kinabalu, with further nationwide expansion planned.
Employer implications/action needed Employers should monitor local implementation and ensure that HR, legal and operations teams know where to direct employment-related filings, inquiries or dispute-related matters where services have been consolidated.
Employer risk N/A
Link N/A
Contact
© Eversheds Sutherland. All rights reserved. Eversheds Sutherland is a global provider of legal and other services operating through various separate and distinct legal entities. Eversheds Sutherland is the name and brand under which the members of Eversheds Sutherland Limited (Eversheds Sutherland (International) LLP and Eversheds Sutherland (US) LLP) and their respective controlled, managed and affiliated firms and the members of Eversheds Sutherland (Europe) Limited (each an "Eversheds Sutherland Entity" and together the "Eversheds Sutherland Entities") provide legal or other services to clients around the world. Eversheds Sutherland Entities are constituted and regulated in accordance with relevant local regulatory and legal requirements and operate in accordance with their locally registered names. The use of the name Eversheds Sutherland, is for description purposes only and does not imply that the Eversheds Sutherland Entities are in a partnership or are part of a global LLP. The responsibility for the provision of services to the client is defined in the terms of engagement between the instructed firm and the client.