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Malaysian Ringgit (MYR)
Bahasa Malaysia
Kuala Lumpur
Embark on your business expansion in Malaysia with BIPO’s Employer of Record (EOR) services. Designed to assist you in navigating the intricacies of local employment laws and regulations, we can help ensure a smooth transition for your business and workforce.
As an Employer of Record (EOR), we act as your legal employment entity, streamlining the process of business expansion. Allowing businesses to focus on their core business operations while the EOR manages all aspects of compliance, payroll, HR, and employee benefits when venturing into the Malaysian market. An EOR provider addresses the common challenges associated with local employment laws, payroll regulations, and work permit requirements.
Employment Contracts must be in written form and include below contents:
Item | Detail | Employer Contribution | Employee Contribution |
Pension (EPF / KWSP: Kumpulan Wang Simpanan Pekerja) | Retirement Benefits | I. Employees ≥ 60 years old: 1) Malaysian: 4% 2) PR non-Malaysians (registered as member before 1 August 1998) whose monthly salary ≤ RM 5,000: 6.5% 3) PR non-Malaysians (registered as member from 1 August 1998) whose monthly salary > RM 5,000: 6%II.Employees < 60 years old: 1) Malaysian or PR whose monthly salary ≤ RM5,000: 13% 2) Malaysian or PR whose monthly salary > RM5,000: 12% 3) Non-Malaysians: RM 5 per person | I. Employees ≥ 60 years old: 1) Malaysian: 0 2) PR non-Malaysians (registered as member before 1 August 1998): 5.5% 3) PR non-Malaysians (registered as member from 1 August 1998): 5.5%II. Employees < 60 years old: 1) Malaysian or PR whose monthly salary ≤ RM5,000 : 11% 2) Malaysian or PR whose monthly salary > RM5,000: 11% 3) Non-Malaysians: 11% |
Employment Insurance System (EIS) | Employment Security | I.Employees ≥ 60 years old: 0 II. Employees < 60 years old: 1) Malaysian or PR whose monthly salary ≤ RM6,000: 0.2% 2) Malaysian or PR whose monthly salary > RM6,000: RM 11.9 per month III.Non-Malaysians: N/A | I.Employees ≥ 60 years old: 0 II. Employees < 60 years old: 1) Malaysian or PR whose monthly salary ≤ RM6,000: 0.2% 2) Malaysian or PR whose monthly salary > RM6,000: RM 11.9 per month III. Non-Malaysians: N/A |
Pertubuhan Keselamatan Social Malaysia in BM (SOCSO/ PERKESO) | Social security | I. Employees ≥ 60 years old and non-Malaysians: 1.25%, capped at RM74.40 II. Employees < 60 years old: 1) Malaysian or PR whose monthly salary ≤ RM6,000: 1.75% 2) Malaysian or PR whose monthly salary > RM6,000: RM 104.15 | I. Employees ≥ 60 years old and non-Malaysians: 0 II. Employees < 60 years old: 1) Malaysian or PR whose monthly salary ≤ RM6,000: 0.5% 2) Malaysian or PR whose monthly salary > RM6,000:RM 29.75 |
Human Resources Development Fund (HRDF) | Training and improvement of professional skills | I.Employers with 10 employees: mandatory, 1% II. Employers with 5-9 employees: voluntary, 0.5% | – |
– | Total | About 15% | About 11.7% |
Effective 1st of February 2025, the minimum wage rates of Malaysia are set as follows:
Minimum Wage Rates | ||||
Monthly | Daily | Hourly | ||
RM 1,700 | Number of working days in a week | RM 8.72 | ||
6 | 5 | 4 | ||
RM 65.38 | RM 78.46 | RM 98.08 |
The National Public Holidays in Malaysia in 2025 is shown as following. Please refer to announcement of Malaysia government.
Holiday Name | Date |
New Year Day | 1 January 2025 |
Chinese New Year | 29 January 2025 |
Chinese New Year Holiday | 30 January 2025 |
Nuzul Al-Quran | 18 March 2025 |
Hari Raya Aidilfitri | 31 March 2025 |
Hari Raya Aidilfitri Holiday | 1 April 2025 |
Labour Day | 1 May 2025 |
Wesak Day | 12 May 2025 |
Agong’s Birthday | 2 June 2025 |
Hari Raya Haji | 2 June 2025 |
Awal Muharram | 27 June 2025 |
Merdeka Day | 31 August 2025 |
Merdeka Day Holiday | 1 September 2025 |
Prophet Muhammad’s Birthday | 5 September 2025 |
Malaysia Day | 16 September 2025 |
Deepavali | 20 October 2025 |
Christmas Day | 25 December 2025 |
The average number of working hours of any period of 3 weeks, or over any period exceeding three weeks, upon approval by the Director-General, shall not exceed 45 hours per week.
<Work Regulation (Part-Time Workers) 2010> requires employers to provide part-time workers benefits similar to those provided to full-time employees, including overtime pay, annual leave and sick leave, and public holidays.
The regulation mentioned above identifies part-time employees who are working 30-70 percent of full-time working hours. Employees who work below 30 percent of full-time working hours are classified as casual workers, who are exempt from this regulation, while those who work more than 70 percent of full-time working hours are considered as full-time employees.
No statutory provisions, normally it is 3 months in practice. Employers also have the right to prolong the probationary period if the new staff is not up to scratch. Standard practice in Malaysia market is not exceeded 6 months.
Statutory leave in Malaysia includes:
Type |
Applicable to |
Details |
Paid Annual Leave |
All Employees |
8-16 days (according to the length of services) |
Pregnancy and Maternity Leave |
Female Employees |
98 days (effective 1st January 2023, only provided for the first five children of eligible employees) |
Paternity Leave |
Male Employees |
7 days (effective 1st January 2023) |
Paid Sick Leave |
All Employees |
14-22 days, hospitalisation leave is up to 60 days. |
Length of Employment |
Notice Period of Termination |
Employed < 2 years |
4 weeks |
Employed ≥ 2 year, but ≤ 5 years |
6 weeks |
Employed > 5 years |
8 weeks |
Length of Employment |
Severance Payment |
Employed < 1 year |
On a pro-rata basis according to the latest monthly wage |
Employed < 2 years |
10 days wage for every served year |
Employed ≥ 2 year, but ≤ 5 years |
15 days wage for every served year |
Employed > 5 years |
20 days wage for every served year |
BIPO’s total HR solutions include our award-winning HR Management System, Global Payroll Outsourcing, Employer of Record service, and Athena BI.
As your EOR partner, our services are designed to provide a comprehensive, hassle-free experience:
Services may vary across countries.
Unlock your growth potential with BIPO’s Employer of Record service in Malaysia. Our EOR service empowers businesses with seamless scalability while ensuring regulatory compliance.
From smooth onboarding to risk mitigation, BIPO handles the administrative HR tasks, enabling companies to concentrate on core business functions and accelerating growth. Our local expertise and global reach ensure efficient operations, enhancing flexibility and reducing operational complexities.
Share this guide
An Employer of Record (EOR) is a partner company that acts as the official employer for your employees.
An EOR company handles all the HR aspects and processes, including the legal complexities associated with regulatory and tax compliance.
As your EOR, BIPO supports your organisation by providing a comprehensive range of HR, payroll and advisory services to ensure your business stays compliant. These include end-to-end on/offboarding services for your employees (e.g.: payroll processing, HR and benefits administration, labour contracts, visa applications, payroll/tax compliance, and more).
By engaging BIPO as your EOR, your business benefits from:
A global EOR benefits organisations regardless of size or industry. It is especially useful for organisations that want to:
A global EOR enables businesses to fast-track their market entry into international market, and reduce the complexities of setting up multiple foreign entities.
When you partner with BIPO, we take on the the day-to-day administrative tasks, while you maintain full control of the business and delegate HR workflows and hiring needs.
Our vast network of business partners across 170+ markets globally supports your business expansion plans, with in-country HR experts providing localised support. Going global has never been easier!
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