# SOCSO and EIS for Employers: Categories, the RM6,000 Ceiling and LINDUNG 24 Jam

> How PERKESO's two contribution streams work — SOCSO Category 1 and 2 under Act 4, EIS under Act 800, the RM6,000 insured-wage ceiling, and the new employee-funded LINDUNG 24 Jam scheme.

- Category: employment
- Language: en
- Status: published
- Updated: 2026-07-20
- Canonical: https://negaraku.md/en/employment/socso-eis-employer-guide

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Before you check a SOCSO rate, check the ceiling it is applied to. That is where
most published Malaysian payroll content fails, and it fails silently — a
correct percentage applied to a stale cap produces a plausible-looking number
that is simply too small.

The insured-wage ceiling has been **RM6,000 since 1 October 2024**, raised from
RM5,000. Guides showing RM5,000 are two years out of date; at least one
well-ranked accounting-firm page still shows RM4,000, which was superseded
before that. Every employee earning above your configured cap is being
under-contributed.

## What are the two PERKESO streams?

PERKESO collects under two different statutes that share a portal, a deadline
and a ceiling, and share nothing else.

**Act 4** — the Employees Social Security Act 1969 — funds the Employment Injury
Scheme and the Invalidity Scheme. This is what people mean by SOCSO.

**Act 800** — the Employment Insurance System Act 2017 — funds EIS, which is
income replacement and re-employment support for people who lose their jobs. It
began on 1 January 2018.

Both are remitted through the ASSIST portal by the **15th of the month following
the wage month**.

## SOCSO: what are Category 1 and Category 2?

The categories are about **employee age**, not employer size, and they determine
which schemes the employee is covered by as well as who pays.

| | First Category | Second Category |
| --- | --- | --- |
| Applies to | Employees below 60 | Employees aged 60 and over |
| Schemes funded | Employment Injury and Invalidity | Employment Injury only |
| Employer share | 1.75 per cent of monthly wages | 1.25 per cent of monthly wages |
| Employee share | 0.5 per cent of monthly wages | Nil |

The logic is that the Invalidity Scheme is a pre-retirement protection, so it
switches off at 60 — and with it the employee's 0.5 per cent. From 60 onward the
employer alone funds injury cover.

At the top of the table, for wages exceeding the RM6,000 ceiling, the Act 4
schedule gives a **Category 1 employer share of RM104.15 and an employee
invalidity share of RM29.75**. The Category 2 employer share at the same point is
**RM74.40**.

## EIS: a flat rate with a narrow gate

EIS is structurally simple and behaviourally complicated.

The rate is **0.2 per cent from the employer and 0.2 per cent from the
employee**, 0.4 per cent in total, on an assumed monthly salary capped at
RM6,000.

Who contributes: employees aged **18 to 60**. Employees aged 57 and above who
have no prior EIS contributions are exempt — there is no point starting a
contribution history that can never mature into a claim.

Who is outside EIS entirely: **government employees, domestic workers and
self-employed persons**.

The complication is that contributing and qualifying are different questions. A
person who loses employment must apply within **60 days** of the loss and must
satisfy the Contributions Qualifying Conditions. And several common ways of
leaving a job do not count as loss of employment at all:

- Voluntary resignation
- Expiry of a fixed-term contract
- Retirement
- Dismissal for misconduct

What does count includes normal retrenchment, VSS and MSS schemes, closure
through natural disaster or bankruptcy, constructive dismissal, resignation
because of sexual harassment or threats at the workplace, and resignation after
being ordered to perform dangerous duties outside the job scope.

That list is worth reading as an employer rather than only as an employee. The
inclusion of constructive dismissal and harassment-driven resignation means a
badly handled exit can convert into an EIS claim and, separately, into a s.20
unfair dismissal representation.

## What is LINDUNG 24 Jam, and why does it make the numbers disagree?

This is the current source of genuine confusion in Malaysian payroll, and the
reason three different maximum contribution figures circulate for the same
salary.

**LINDUNG 24 Jam**, formally the Skim Kemalangan Bukan Bencana Kerja (SKBBK),
extends protection to accidents that happen outside working hours and are not
connected to the employee's work — the twenty-four-hour cover that ordinary
SOCSO injury protection does not give.

Three things about it matter for payroll:

**It is funded entirely by the employee.** There is no employer share. The
employer's role is to deduct and remit on the employee's behalf for as long as
the employee works for them.

**The rate is phased.** 0.75 per cent for the first two years, 1.0 per cent for
the next three years, and 1.25 per cent from the sixth year onward, on wages
capped at RM6,000. At the ceiling the phase-one deduction is **RM44.65**.

**It is not compulsory for local employees.** PERKESO states that SKBBK is no
longer mandatory for local employees — participation is voluntary and borne
entirely by the employee, with an opt-out mechanism — **while remaining
mandatory for foreign workers** in accordance with the law in force.

That last point is the one that breaks rate tables. PERKESO's current Act 4
contribution schedule presents SKBBK as an extra employee column alongside the
injury and invalidity columns. Read the whole row and you get a Category 1 total
of RM178.55 at the ceiling. Read only the mandatory columns for a local employee
who has opted out and you get RM133.90. Read the Category 2 row with SKBBK and
you get RM119.05; without it, RM74.40. All of these figures are on PERKESO's own
schedule. They describe different employees.

Cases SKBBK does not cover include accidents occurring outside Malaysia, foreign
workers who have misused a pass or permit or breached an entry condition under
the Immigration Act 1959/63, and conditions caused by disease such as diabetes,
fever or hypertension.

## How the three interact on one payslip

For a Malaysian employee under 60 earning above the ceiling who has opted out of
SKBBK, the PERKESO side of the payslip is: employer 1.75 per cent for SOCSO plus
0.2 per cent for EIS; employee 0.5 per cent for SOCSO plus 0.2 per cent for EIS
— all computed on RM6,000, not on actual wages.

For a foreign worker, SOCSO applies, SKBBK applies as a mandatory employee
deduction, and EIS coverage should be confirmed against the Act 800 definition
of employee before you configure it — see the note in `verificationNeeded`.

For an employee aged 62, there is no employee SOCSO share and no EIS at all.

## Common mistakes

**Leaving the ceiling at RM5,000.** Superseded on 1 October 2024. This is the
highest-frequency error in the category and the easiest to fix.

**Trusting a rate table dated before October 2024.** The RM4,000 ceiling that
still appears on some accounting-firm pages predates even the previous revision.

**Treating SOCSO categories as employer categories.** They are age bands for
employees. Every employer has both categories on the payroll the moment someone
turns 60.

**Continuing the 0.5 per cent employee SOCSO deduction past age 60.** The Second
Category has no employee share. Deducting it is an unauthorised deduction from
wages as well as a PERKESO error.

**Continuing EIS past age 60.** EIS runs from 18 to 60.

**Deducting SKBBK from local employees automatically.** It is voluntary for
locals, with an opt-out. Automatic deduction without the employee's
participation is a deduction they did not agree to.

**Assuming an EIS contributor can always claim.** Resignation, contract expiry,
retirement and dismissal for misconduct are outside the scheme, and any claim
must be made within 60 days of the loss of employment.

**Applying the ceiling to the rate rather than the wage.** The cap works by
treating wages above RM6,000 as though they were RM6,000, then applying the
rate. It does not cap the resulting contribution at some other figure.

## What's next

Do three checks this week: confirm your payroll ceiling reads RM6,000, confirm
that employees aged 60 and over have no employee-side SOCSO or EIS deduction,
and confirm your SKBBK treatment matches each employee's actual status —
mandatory for foreign workers, opt-in for locals.

Then move to the other streams sharing the same 15th deadline: the
[EPF employer guide](/en/employment/epf-employer-guide), where the
Third Schedule mechanic catches most employers out, and
[PCB/MTD](/en/employment/pcb-mtd-malaysia). The full set of dated
duties sits in the
[payroll compliance calendar](/en/employment/payroll-compliance-malaysia).

## Sources

- Contribution Rate — https://www.perkeso.gov.my/en/rate-of-contribution.html (PERKESO)
- Contributions — https://www.perkeso.gov.my/en/our-services/employer-employee/contributions.html (PERKESO)
- Employees Social Security Act 1969 (Act 4): New Contribution Rate Including SKBBK — https://www.perkeso.gov.my/images/lindung/lindung-24-jam/NewContributionRateIncludingSKBBK.pdf (PERKESO)
- Skim Kemalangan Bukan Bencana Kerja (LINDUNG 24 JAM) — https://www.perkeso.gov.my/skim-kemalangan-bukan-bencana-kerja-lindung-24-jam.html (PERKESO)
- Employment Insurance (LINDUNG KERJAYA) — https://www.perkeso.gov.my/en/our-services/protection/employment-insurance.html (PERKESO)

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