As part of its ongoing efforts to enhance employee welfare, the Social Security Organization (SOCSO/PERKESO) has announced an important update regarding contribution limits. Starting from October 1, 2024, the salary ceiling for SOCSO contributions will be increased from RM5,000 to RM6,000 per month. This change affects both employers and employees, ensuring a higher level of social security coverage for workers in Malaysia.

Important Changes in SOCSO Contributions

1. Employees earning above RM6,000 per month will have their contributions calculated based on the new ceiling of RM6,000.
2. Employers must ensure that SOCSO contributions from October 2024 onwards adhere to this revised salary ceiling limit.
3. The updated contribution rates align with Act 4 and Act 800, reinforcing legal compliance with Malaysia’s social security regulations.

Impact on Different Employee Categories

1. General Employees: Contributions for employees earning more than RM5,000 per month will now follow the Third Schedule (Act 4) and the Second Schedule (Act 800).
2. Foreign Workers: Their contribution rates will be based on the Third Schedule (Act 4).
3. Domestic Workers: Contribution rates depend on their qualification under the Domestic Workers section.
4. Self-Employed Individuals: Contributions under the Self-Employed Social Security Act (Act 789) remain applicable with structured monthly and annual payment rates.

Self-Employed Contribution Rates (Act 789)

1. For a monthly income of RM1,050, the monthly contribution is RM13.10, while the annual contribution is RM157.20.
2. For a monthly income of RM1,550, the monthly contribution is RM19.40, while the annual contribution is RM232.80.
3. For a monthly income of RM2,950, the monthly contribution is RM36.90, while the annual contribution is RM442.80.
4. For a monthly income of RM3,950, the monthly contribution is RM49.40, while the annual contribution is RM592.80.

Housewives Social Security Scheme (Act 838)

For housewives under Act 838, a fixed RM120 contribution ensures coverage for a period of 12 consecutive months, payable in advance.

Why This Update Matters?

The increase in the salary ceiling for SOCSO contributions aims to provide better financial security and protection for employees in Malaysia. With higher contribution limits, employees will have access to improved benefits, including compensation for work-related injuries, medical expenses, and disability support.

Employer Compliance & Next Steps

Employers must update their payroll systems to reflect the new contribution ceiling effective October 2024. Non-compliance could result in penalties, so it is crucial to ensure all SOCSO payments align with the latest regulations.

For more information and the latest updates on SOCSO/PERKESO contributions, visit the official PERKESO website or contact your nearest SOCSO office.