The Gig Workers Act 2025: a classification statute with a social-security bolt-on

Act 872 is being covered as a social-security story: platforms must now deduct SOCSO. That is the smallest part of it. The larger effect is that Malaysia now has a statutory third category between employee and independent contractor — and the statute defines that category by telling you what it is not.

What is a service agreement?

Section 2 defines it as any agreement, oral or written, express or implied, between a contracting entity and a gig worker for the provision of a service in Malaysia in exchange for earnings — but does not include a contract of service as defined under the Employment Act 1955, the Labour Ordinance of Sabah (Cap. 67), the Labour Ordinance of Sarawak (Cap. 76) or the Occupational Safety and Health Act 1994, nor a contract of employment under the Industrial Relations Act 1967.

Read that again from a compliance angle. Act 872 does not decide the classification question — it presupposes it. If the engagement is in substance a contract of service, Act 872 falls away and the full employment stack applies: EA entitlements, EPF, SOCSO as an employer, PCB, and s.20 unfair dismissal exposure. Signing an Act 872 service agreement does not immunise a relationship that a court would characterise as employment.

What the Act does add is a floor of rights that used to be pure contract, and a forum to enforce them.

Who is a gig worker?

Under s.2 a gig worker is an individual who:

1. is a citizen or permanent resident of Malaysia;
2. enters into a service agreement either with a platform provider for any service, or with a non-platform contracting entity for a service specified in the Schedule; and
3. receives earnings for the service.

The citizenship requirement is doing real work — a foreign national delivering for a platform in Malaysia is outside the definition.

A platform provider is any digital intermediary system provider who connects the service by a gig worker to a service user. A contracting entity is broader: an individual, any person or body incorporated or registered under any written law, or a platform provider, who engages a gig worker under a service agreement.

The Schedule, which applies to non-platform engagements, covers acting; filming activities; music-related activities (singer, musician, composer, lyricist); aesthetic work (make-up artist, hair stylist, stylist); translation (sign interpreter, interpreter or translator, transcriber); journalism (journalist, stringer); prenatal and postnatal care; palliative, elderly and rehabilitation care; and photography and videography. The Minister may amend it under s.110.

What rights does Part III create?

Part III gives the gig worker rights to earnings (s.11), restrictions on deduction of earnings, tips and gratuities (s.12), a right to an earnings slip (s.13), protection around deactivation under a service agreement (s.14), priority of earnings over other debts (s.15), and a right to join, participate in or establish a gig workers’ association (s.10). Section 9 prohibits certain acts by the contracting entity, and s.16 sets out its duties.

None of this is employment law. It is closer to a fair-dealing code for a commercial relationship with a structural power imbalance.

How are disputes resolved?

The route is sequential, and it starts inside the platform.

1. Internal grievance mechanism (s.17) — the contracting entity must provide one in the service agreement.
2. Conciliation (ss.18–21) before a Conciliator, or by the Minister under s.20. Non-compliance with settlement terms is dealt with under s.21.
3. Gig Workers Tribunal (Part V) — the Conciliator or the Minister refers the dispute.

Section 33(1) gives the Tribunal jurisdiction over any dispute referred to it by the Conciliator or the Minister, with power to grant any award it thinks just and appropriate, and s.33(3) allows a complaint to include consequential loss or damages.

Section 33(2) is the important limit: the Tribunal has no jurisdiction over offences under the Act, and none over any Part VIII matter. Social security disputes run through s.94 and the Self-Employment Social Security Act 2017 instead.

The Tribunal sits as a single member — the President, Deputy President, or a member selected by the President (s.34(1)). The Gig Workers (Gig Workers Tribunal) Regulations 2026, P.U.(A) 144, gazetted 30 March 2026, set the procedure and came into force on 31 March 2026. The Ministry of Human Resources states that parties may not be represented by lawyers, and that an appeal against an award lies to the High Court within fourteen days. Section 45 makes failure to comply with an award an offence.

What is the social security duty?

Part VIII applies only to a contracting entity who is a platform provider (s.81).

Section 83 lists the duties: submit gig worker information to PERKESO; ensure the worker is registered under the Self-Employment Social Security Scheme under Act 789; make the deduction from earnings and contribute on the worker’s behalf; implement mandatory deduction at the prescribed percentage; notify the worker to pay any shortfall below the minimum monthly contribution; and notify the worker to select a plan where the deduction exceeds the minimum.

The Ministry of Human Resources FAQ states the deduction rate per transaction is set for the time being at 1.25%, with the wording indicating it is a current setting rather than a permanent statutory figure. Deductions flow to PERKESO through an integration between the platform’s digital intermediary system and PERKESO’s.

The underlying Act 789 plans, as published in the same FAQ:

Plan	Insured monthly earnings	Monthly contribution	Annual contribution
1	RM1,050	RM13.10	RM157.20
2	RM1,550	RM19.40	RM232.80
3	RM2,950	RM36.90	RM442.80
4	RM3,950	RM49.40	RM592.80

Where a worker serves several platforms, every platform deducts on its own transactions (FAQ Q124). There is no statutory age limit for registration under Act 789 for this purpose.

Commission, council, or neither?

Worth being precise, because the reporting is loose. Act 872 establishes a Gig Workers Tribunal (Part V) and a Consultative Council (Part VI, Majlis Perundingan). It does not establish a commission. The Malaysian Gig Economy Commission (SEGIM) reported in the press is an administrative body, and its legal basis is not Act 872 — treat claims about its powers with care until you can point to the instrument that created it.

Common mistakes

Assuming Act 872 settles classification. It defines itself out of the way of the contract-of-service tests. A mislabelled employee is still an employee.

Applying the 1.25% deduction as a general freelancer rule. Part VIII binds platform providers only. Non-platform contracting entities under the Schedule have Part III duties but no deduction duty.

Treating the deduction as an employer contribution. It is a deduction from the gig worker’s earnings, remitted on the worker’s behalf — not an employer-funded contribution in the SOCSO Category 1 sense.

Ignoring the shortfall notification. If the 1.25% does not reach the Act 789 minimum for the month, s.83(e) puts a positive notification duty on the platform.

Engaging non-citizens as gig workers. The s.2 definition requires citizenship or permanent residence.

Expecting the Tribunal to hear contribution disputes. Section 33(2) excludes all Part VIII matters.

What’s next

If you operate a platform, the immediate work is the PERKESO system integration, the earnings-slip requirement under s.13, and a documented internal grievance mechanism under s.17 — that last one is a precondition to the whole dispute pathway and is cheap to get wrong. If you engage freelancers off-platform, check whether the service falls in the Schedule, and separately re-run the contract-of-service test, because that is the question Act 872 leaves exactly where it found it.