Purpose of SOCSO
The purpose of SOCSO is to provide security and protection, as well as a just, accurate, timely and quality service economically to all employees, their dependents and their employers. SOCSO aims to:
|pay temporary disablement benefits (first payment) to injured employees within a month|
|pay disablement benefits (first payment) and constant attendance allowance to all injured employees within 3 months|
|pay dependents benefits (first payment) to dependents within 3 months|
|pay invalidity pension (first payment)/ invalidity grant/ constant attendance allowance to employees who qualify within a period of 3 months|
|pay survivor's pension (first payment) to dependents within a period of 3 months|
|pay funeral benefits to eligible dependents of deceased person within 15 days|
Registering with SOCSO
Employers are required to fill Form 1 (Employer Registration Form) and Form 2 (Employee Registration Form) for registration with SOCSO. SOCSO will then issue a employers code number to be used in all correspondence with the company.
Principal employer- This refers to an employer who has employed the employee directly to work for him. The employer undertakes the payment of wages and all the service matters of the employee.
Immediate employer- This refers to an employer who works for a principal employer or undertakes part of the work of the principal employer by sub-contract. The immediate employer has direct control of the employees employed by him.
The principal and immediate employer who employs one or more employees is required to register and contribute monthly for all employees. The principle employer is also liable to ensure that all employees employed by the immediate employer have to be registered and their contributions paid. In the event that the employees have not been registered and the immediate employer cannot be located, the principal employer is liable under the Social Security Act 1969 for all contributions.
A person employed under a contract of service or apprenticeship is an employee under the Act. It is compulsory for an employee earning a monthly wage of less than RM2000 to make contributions to SOCSO. What happens with an employee earning a monthly wage of more than RM2000?
There are 2 situations regarding this matter. They are:
|Employees who previously registered with and have contributed to SOCSO must compulsorily continue to contribute even if their present wage exceeds RM2000 monthly. The employees must be protected in line with the principle of "once covered, always covered" to preserve their rights accumulated under the Invalidity Pension Scheme.|
|Employees who receive a monthly wage exceeding RM2000 and who have not previously registered or paid contributions to SOCSO are given an option to be covered under the Act. Both the employer and employee have to consent to the coverage by filling in the necessary forms.|
Are all employees eligible for SOCSO coverage?
All employees eligible for coverage under the Act must register and contribute to SOCSO irrespective of employment status, whether permanent, temporary or casual in nature. However, certain categories of employment are exempted from coverage, namely:
|Self- employed persons|
|Foreign workers (exempted since April 1st, 1993)|
Is the age of the employee a factor?
All employees must be registered irrespective of their age. However, employees who exceed age 55 will continue to be protected under the employment injury scheme if they continue to be employed after that age. Only the employer shall contribute to SOCSO for such employees.
Is this scheme compulsory?
This is a compulsory scheme. Employers must cover their employees even if they have other private insurance coverage for them. Employees are eligible for all benefits from SOCSO and compensation under any private insurance policy in the event of an accident.
The principal employer must make a monthly contribution for each eligible employee according to the rates specified under the Act. The employee's share of 0.5% of wages should be paid for coverage under the Invalidity Pension Scheme while the employer pays 1.75% for the Employment Injury Insurance Scheme and the Invalidity Pension Scheme.
Types and categories of contribution:
|The first category: Employment Injury Insurance Scheme and Invalidity Pension Scheme. The payment of the contribution is by both the employer and employee.|
|The second category: Employment Injury Insurance Scheme Only. The payment of contributions is made only by the employer, i.e. for an employee who is not eligible for coverage under the Invalidity Pension Scheme.|
All remuneration payable in money to an employee is wages for purposes of SOCSO contributions. This includes the following payments:
|Commissions and service charge|
|Payments for leave, annual leave, maternity, rest day, public holidays and other|
|Allowances, incentives, shifts, food, cost of living, housing and others|
All payments made to an employee paid at an hourly rate, daily rate, weekly rate, piece or task rate is considered as wages, except the below:
|Payments by an employer to any statutory fund for employees|
|Gratuity payments or payments for dismissal or retrenchments|
SOCSO provides protection to eligible employees through two schemes namely the Employment Injury Insurance Scheme and the Invalidity Pension Scheme.
Employment Injury Insurance Scheme
The scheme provides an employee with protection for accidents that occur while:
|Traveling (commuting accident)|
|Arising out of and in the course of employment|
What are the benefits provided under the scheme? The benefits provided are:
|Temporary disablement benefit|
|Permenant disablement benefit|
|Constant dependent benefit|
Has your employer registered you with SOCSO?
Each employee registered with SOCSO will be given a Social Security Registered Number. If your employer has not registered you, please contact the SOCSO Office nearest to you. For more information, please contact:
Pertubuhan Keselamatan Sosial (PERKESO)
Lot 281, Jalan Ampang,
50538 Kuala Lumpur.
General Line: 03-4253 5320
Call Center: 03-4257 5755