If you've just hired your first employee in Malaysia, you've probably already sorted out EPF — but SOCSO tends to trip people up. Is it the same as EPF? Do you register once or every month? What actually happens if you're late? This SOCSO Malaysia employer guide walks through what SOCSO covers, who needs to register, the current 2026 contribution rates, and how to stay compliant — including a scheme that quietly changed everyone's payslip starting June 2026.
For SME owners and HR staff juggling this alongside payroll, leave, and everything else, the goal here isn't to memorise the Employees' Social Security Act 1969. It's to know enough to register correctly, pay the right amount, and know where to check when something looks off.
SOCSO (Social Security Organisation, or PERKESO — Pertubuhan Keselamatan Sosial — in Malay) is Malaysia's mandatory social insurance scheme for employees, covering workplace injury and invalidity. Employers must register within days of hiring their first employee and contribute monthly, calculated on wages up to a RM6,000 ceiling. Rates depend on the employee's age and contribution history, and since June 2026 a new scheme — LINDUNG 24 Jam — adds a further employee-funded layer of protection.
What Does SOCSO Actually Cover?
SOCSO administers two core protections under Act 4: the Employment Injury Scheme, which covers accidents or diseases arising from work, and the Invalidity Scheme, which provides income support if an employee becomes permanently unable to work due to a non-work-related condition. Together, these are what most employers mean when they say "SOCSO contributions."
A third scheme, the Employment Insurance System (EIS), sits alongside SOCSO under separate legislation (the Employment Insurance System Act 2017) and provides temporary financial support and job-search help to employees who lose their jobs. It's collected through the same PERKESO channel, which is why it's usually discussed together with SOCSO.
SOCSO coverage isn't limited to Malaysian citizens — foreign workers with a valid work pass are covered too. The Employment Injury Scheme has applied to foreign workers since 2019, and the Invalidity Scheme was extended to them from 1 July 2024, closing a long-standing gap in protection.
Who Must Register for SOCSO?
Any employer with one or more employees is legally required to register with PERKESO — there's no minimum headcount exemption for small businesses. Registration happens once, through PERKESO's online ASSIST Portal, and then monthly contributions follow automatically for every eligible employee.
On the employee side, coverage depends on age and contribution history. Employees who are under 60 and start contributing before turning 55 fall under Category 1 (Employment Injury + Invalidity). Employees who are 60 or older, or who join SOCSO for the first time at 55 or above, fall under Category 2 (Employment Injury only). This distinction matters because it changes who pays and how much — covered in the next section.
Contributions are calculated on monthly wages up to a ceiling of RM6,000, effective 1 October 2024 (raised from the previous RM5,000 ceiling). Anyone earning above that is still contributed on the RM6,000 cap, not their full salary.
SOCSO Contribution Rates in 2026
Here's where the two categories matter (see PERKESO's official Contribution Rate page for the full banded table). Category 1 employees: the employer pays 1.75% of monthly wages, the employee pays 0.5%. Category 2 employees: only the employer contributes, at 1.25% — there's no employee deduction, since Invalidity coverage no longer applies. EIS runs separately at 0.4% total (0.2% employer, 0.2% employee), also capped at the RM6,000 wage ceiling. Employees who are 57 or older with no prior SOCSO contribution history are exempt from EIS.
Rates shown are official percentages confirmed on perkeso.gov.my as of July 2026, applied to monthly wages up to the RM6,000 ceiling. At the ceiling, this works out to roughly RM105 employer + RM30 employee for Category 1, and roughly RM12 + RM12 for EIS — PERKESO rounds these using its own banded contribution table, so use PERKESO's official Contribution Calculator for exact sen amounts on any specific salary.
How to Register and Pay SOCSO Contributions
Registration happens through PERKESO's ASSIST Portal. You'll set up a portal ID, then submit Borang 1 (Employer Registration) and Borang 2 (Employee Registration) with supporting documents. (See our Employer Registration Guide: EPF, SOCSO, and LHDN Compliance in Malaysia for the full step-by-step walkthrough across all three statutory bodies.) PERKESO confirms registration by email once processed. Employers are generally expected to register within 30 days of hiring their first employee — treat this as a task for week one, not something to circle back to later.
Once registered, monthly contributions are calculated and paid through the same ASSIST Portal, typically due by the 15th of the month following the wage period. If you're already running payroll through an HR system, this is usually the point where contribution amounts get calculated automatically rather than by hand — worth checking whether your current setup does this for you.
Penalties and What Changed in June 2026
Non-compliance isn't a soft rule. Under Section 94 of the Employees' Social Security Act 1969, employers who fail to register, pay late, or don't pay at all can be fined up to RM10,000, imprisoned for up to 2 years, or both. PERKESO can also issue compound notices (administrative fines, typically a few hundred to a few thousand ringgit depending on the violation and how long it's gone unaddressed) as an alternative to prosecution.
The bigger 2026 development: LINDUNG 24 Jam (SKBBK), a new Non-Employment Injury Scheme, took effect 1 June 2026. It extends protection to accidents that happen outside working hours and aren't job-related. For local employees, participation is currently voluntary and fully employee-funded; for foreign workers, it's mandatory. The employee contribution phases in over time — employers deduct and remit it, but don't contribute themselves.
At the RM6,000 wage ceiling, Phase 1's 0.75% works out to roughly RM45/month, deducted from the employee's wages — not an added employer cost, but an added line on the payslip your team will likely ask you about.
Common SOCSO Questions
Is SOCSO the same as EPF? No. EPF is a retirement savings fund; SOCSO is social insurance covering workplace injury, invalidity, and (via EIS) job loss. They're separate mandatory schemes, both registered and paid through their own PERKESO/EPF channels, and both required for every Malaysian employee.
Do I need to register for SOCSO if I only have one employee? Yes. There's no minimum headcount — any employer with one or more employees is required to register with PERKESO, generally within 30 days of that first hire.
What's the current SOCSO wage ceiling? RM6,000 per month, effective since 1 October 2024. Contributions are calculated on wages up to this ceiling, even for employees earning more.
Do foreign employees need SOCSO contributions? Yes. Foreign workers with valid work passes are covered under the Employment Injury Scheme (since 2019) and the Invalidity Scheme (since 1 July 2024), and are mandatorily included in the new LINDUNG 24 Jam scheme from June 2026.
What is LINDUNG 24 Jam and does it cost employers more? It's a new scheme (from 1 June 2026) covering accidents outside working hours. For local employees it's voluntary and paid entirely by the employee (starting at 0.75% of wages); employers handle the deduction and remittance but don't contribute their own share.
What happens if I miss a SOCSO payment? Late or non-payment can result in a fine of up to RM10,000, up to 2 years' imprisonment, or both, under Section 94 of the Act — plus PERKESO may charge interest on the overdue amount. Catching it within the same month and paying promptly avoids most of this.
Getting SOCSO right is mostly about not letting it become a monthly manual task you have to remember. Swingvy's Payroll module calculates SOCSO, EIS, and EPF contributions automatically as part of running payroll, so rate changes — like the LINDUNG 24 Jam rollout — don't depend on someone catching a PERKESO circular in time. If your current setup still means checking rate tables by hand every month, it might be worth seeing how Swingvy's cloud HR system Running PCB too? See our PCB Malaysia guide for the monthly tax deduction side of payroll compliance.
.png)
SOCSO compliance isn't complicated once the registration and rates are sorted — it's staying current with changes like this year's LINDUNG 24 Jam scheme that catches most employers off guard. Bookmark the rates, register early, and you're covered.
.png)
