Published On: 23/06/2025By

Update on Contribution Amount for Act 4 and Act 800 in accordance with the Increment of the Wage Ceiling Limit

Effective 1 October 2024, employers in Malaysia will need to adapt to updated contribution tables for the Social Security Organisation (SOCSO) and Employment Insurance System (EIS). This update raises the wage ceiling for contributions from RM5,000 to RM6,000 per month. Employees earning more than RM5,000 will now have their contributions capped at the new ceiling of RM6,000. This change is aimed at enhancing the social security protection provided to employees and ensuring that contributions reflect the current wage environment. Below, we break down the key changes and how they will impact both employers and employees.

To check new contribution rate, please click at below link:

https://www.perkeso.gov.my/…/majikan…/kadar-caruman.html

New SOCSO Contribution Table (Effective October 1, 2024)

The revised wage ceiling means that employees earning above RM5,000 will now contribute based on their higher salaries. Consequently, they’ll gain better protection in case of work-related accidents, illnesses, or during periods of unemployment. Although this results in a slight increase in contributions, it also provides enhanced benefits.

 

New EIS Contribution Table (Effective October 1, 2024)

One significant update is the revision to the Employment Insurance System (EIS) contribution table, which takes effect on October 1, 2024. These updates particularly affect employees earning more than RM6,000 per month, with a new cap on contributions. Here’s a look at the new EIS contribution structure:

 

Key Changes Employers Need to Know

The main update is straightforward: the wage ceiling increase means contributions are now calculated on salaries up to RM6,000. Here’s how this affects you:

  • Employee Contributions: If employees earn between RM5,000 and RM6,000, contributions will be based on the new ceiling. While deductions will increase slightly, this also enhances their benefits.
  • Employer Contributions: Employers will also need to adjust contributions. Payroll settings and limits should be reviewed and updated accordingly.
  • Contribution Caps: Salaries over RM6,000 will not incur additional contributions beyond the capped amount of RM6,000.

 

Benefits of the Wage Ceiling Increase for Employees

Although employees will see slightly higher deductions, this change translates into better benefits:

  • Enhanced Cash Benefits: Higher contributions mean increased cash benefits during accidents, illnesses, or unemployment, offering employees a more robust safety net.
  • Improved Social Security Coverage: This adjustment enhances protection under the Employees’ Social Security Act and the Employment Insurance System Act, providing more comprehensive coverage.