What is Social Security Organization (SOCSO) / Pertubuhan Keselamatan Sosial (PERKESO)

SOCSO, officially known as the Social Security Organisation, is Malaysia’s statutory body responsible for protecting employees against workplace risks. In Malaysia, SOCSO is referred to as PERKESO, which stands for Pertubuhan Keselamatan Sosial. Whether you are an employer running payroll or an employee verifying your entitlements, understanding SOCSO and PERKESO is a legal and financial necessity.

Established on 1 January 1971 under the Employees’ Social Security Act 1969 (Act 4), SOCSO operates under the Ministry of Human Resources (MOHR). It is the authoritative body for social security administration in Malaysia’s private sector, covering millions of workers across industries.

 

What Does SOCSO Stand For and What Is PERKESO’s Full Name?

This is one of the most commonly searched queries in Malaysia, and the answer is straightforward.

• SOCSO full name: Social Security Organisation
• PERKESO full name: Pertubuhan Keselamatan Sosial

Both names refer to the same government agency. SOCSO is the English acronym; PERKESO is the Malay acronym. The terms SOCSO and PERKESO are used interchangeably in official, legal, and payroll contexts across Malaysia.

What Is the Role of SOCSO/PERKESO in Malaysia’s Workforce Protection?

SOCSO/PERKESO serves as the primary social safety net for private-sector employees in Malaysia. Its core mandate is to provide financial protection and rehabilitation support when employees suffer workplace accidents, occupational diseases, permanent invalidity, or death.

The key roles of SOCSO (PERKESO) include:

• Registration of employers and employees under the Employees’ Social Security Act 1969
• Collection of monthly contributions from both employers and employees based on the official PERKESO contribution schedule
• Disbursement of financial benefits to injured workers or their dependents in the event of accident, disability, or death
• Physical and vocational rehabilitation for insured persons recovering from workplace injuries
• Promotion of occupational safety and health (OSH) awareness across industries
• Administration of the Employment Insurance System (EIS) under Act 800, which provides income replacement for retrenched workers

What Are the Two Main SOCSO Schemes Every Employer Must Know?

SOCSO was entrusted with the administration of two social security schemes: the Employment Injury Scheme and the Invalidity Scheme.

Employment Injury Scheme

This scheme covers employees who suffer injury arising directly from employment. Coverage includes:

• Industrial accidents sustained while performing work duties
• Commuting accidents while travelling to or from the workplace
• Accidents during emergencies connected to employment
• Occupational diseases arising from the nature of work

Invalidity Scheme

The Invalidity Scheme provides coverage and protection for an insured person who suffers from invalidity due to a specific morbid condition of permanent nature, either incurable or unlikely to be cured, rendering them incapable of earning at least one-third (1/3) of the customary earnings of a sound insured person. Critically, this scheme also provides 24-hour coverage against invalidity or death due to any cause, not solely employment-related incidents.

What Are the Current SOCSO Contribution Rates in Malaysia (2026)?

Effective 1 October 2024, PERKESO enforced a new wage ceiling for contributions, raising it from RM5,000 to RM6,000 per month. This is a significant payroll update that all employers must reflect in their systems.

For employees below 60 years of age, contributions are payable by employers and employees for both the Employment Injury Scheme and the Invalidity Scheme. The rate comprises 1.75% employer share and 0.5% employee share of monthly wages, according to the official PERKESO contribution schedule.

For employees aged 60 and above, only the Employment Injury Scheme applies, with the employer contributing 1.25% of the employee’s monthly wage. No contribution is required from the employee in this category.

Key update for foreign workers: As of 1 July 2024, foreign workers in Malaysia are now included under the SOCSO Invalidity Scheme, with PERKESO/SOCSO contribution rates applied equally to both foreign and local workers.

Who Is Required to Contribute to SOCSO/PERKESO in Malaysia?

SOCSO contributions are mandatory for all private-sector employees in Malaysia, including full-time, part-time, and contract employees earning up to RM6,000 per month. Both employers and employees contribute, with employers responsible for deducting the employee’s share and submitting the total contributions to SOCSO.

Who is exempt from SOCSO (PERKESO)?

The following categories are not required to contribute:

• Federal and State Government permanent employees (covered under separate pension schemes)
• Domestic servants
• Self-employed individuals (unless voluntarily enrolled under the LINDUNG KENDIRI scheme)
• Spouses of sole proprietors or partnership owners (unless formally employed under a contract of service)

Important: Employers may be prosecuted and shall be punishable with imprisonment for a term which may extend to two years, or with a fine not exceeding ten thousand ringgit, or both, for failure to register employees or remit contributions on time

What Benefits Does SOCSO/PERKESO Provide to Employees?

SOCSO provides a comprehensive range of monetary and non-monetary benefits to insured persons and their dependents. These include:

• Medical benefits include free treatment at designated PERKESO panel clinics and hospitals.
• Temporary Disablement Benefit with income replacement during recovery from a workplace injury.
• Permanent Disablement Benefit is ongoing financial compensation based on the assessed loss of earning capacity.
• Invalidity Pension a monthly pension for employees permanently incapacitated due to any cause.
• Survivors’ Pension financial support is paid to dependents upon the death of an insured person.
• Dependants’ Benefit is payable to eligible family members in the event of an employee’s death from work-related causes.
• Constant Attendance Allowance for insured persons requiring full-time care due to total disability.
• Physical and Vocational Rehabilitation PERKESO operates dedicated rehabilitation centres to help injured employees return to productive employment.
• Hemodialysis treatment is provided free of charge at PERKESO dialysis panel centres, government hospitals, or NGO-run centres as part of the rehabilitation benefits programme.

How Does an Employer Register and Pay SOCSO Contributions Online?

On 1 January 2018, PERKESO introduced the PERKESO ASSIST Portal to facilitate employers in managing their SOCSO registration, updating records, and contribution payments.

Payment methods available via ASSIST Portal include:

• Financial Process Exchange (FPX) internet banking through any FPX-participating bank.
• Direct Debit Authorization (DDA) e-mandate applied through the ASSIST Portal.
• Bank counters at appointed collection agents, Maybank Berhad and Public Bank Berhad.
• PRIHATIN Mobile App available on Google Play Store and App Store for domestic worker contributions.

Conclusion

Understanding SOCSO (PERKESO) is not optional for businesses operating in Malaysia; it is a statutory obligation under the Employees’ Social Security Act 1969. From mandatory contribution rates and scheme coverage to online portals and rehabilitation benefits, every employer and employee must remain current on their PERKESO obligations to ensure compliance and workforce protection.

3E Accounting Malaysia provides comprehensive payroll and HR compliance services, including SOCSO/PERKESO registration, contribution management, and advisory support for businesses of all sizes. Contact our team today to ensure your company meets all statutory requirements with accuracy and confidence.

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