SOCSO’s New 24-Hour Protection Scheme: What Foreign Companies in Malaysia Need to Do Since 1 June 2026

Malaysia’s social security framework changed materially on 1 June 2026. This article explains what the change means in practice for foreign companies operating in Malaysia – and what your payroll, HR, and legal teams needed to do.

The Change, in Plain Terms

The Employees’ Social Security (Amendment) Act 2026 (Act A1788) introduced a new scheme which took effect on 1 June 2026. Called Skim Kemalangan Bukan Bencana Kerja – commonly referred to as LINDUNG 24 Jam – this scheme extends SOCSO protection to cover employees for accidents occurring outside working hours.

Before this, SOCSO coverage under the Employees’ Social Security Act 1969 (Act 4) was broadly limited to employment injuries: accidents arising out of and in the course of employment, commuting accidents, and occupational diseases. If an employee was injured at home over the weekend, SOCSO did not cover it. LINDUNG 24 Jam closes that gap.

What this means operationally is straightforward: from 1 June 2026, a new employee-funded contribution column appears in the SOCSO payroll structure. Employers deduct it, employers remit it, and employers are legally responsible for getting it right.

The financial amount involved is modest – capped at RM44.65 per employee per month under the First Phase rate, confirmed in the substituted Third Schedule of Act A1788. The compliance obligation is not.

Why This Matters Specifically to Foreign Companies

Foreign companies operating in Malaysia tend to manage their payroll compliance from a distance. Regional HR centres, global HRIS platforms, and outsourced payroll providers handle the day-to-day mechanics, with local teams focused on business operations rather than statutory administration. That structure works well – until a statutory change comes through and the question arises: has our provider actually updated for this?

LINDUNG 24 Jam is precisely the kind of change that falls through the gap. The contribution amount is small. The scheme sounds straightforward. And there is a six-month grace period from PERKESO on enforcement. All three of those facts, taken together, create the conditions for an entity to arrive at 1 October 2026 – when PERKESO’s new mandatory submission file format also takes effect – without having made a single correct SKBBK remittance.

That is not a theoretical risk. It is a foreseeable outcome of the way foreign companies are structured, and it is one that is entirely avoidable.

Below, we work through the three areas where foreign companies are most likely to encounter difficulty.

Area 1: Your Payroll System

The new SKBBK contribution is a separate column in the revised Third Schedule of Act 4. It is not a percentage applied to gross salary – it is a banded fixed-amount table, calculated by reference to the employee’s monthly wage bracket, with a ceiling at RM6,000 per month. Employees earning above RM6,000 pay the same fixed amount as those at the ceiling; their salary above that level is simply not captured.

To illustrate how this works in practice:

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The implication for your payroll system is that the contribution cannot be calculated by applying a flat percentage to salary. The banded table governs. If your payroll provider has not updated their Malaysian contribution tables, they will either calculate incorrectly or not calculate at all.

What to do: contact your payroll provider and request written confirmation that their Malaysian SOCSO tables have been updated for LINDUNG 24 Jam effective 1 June 2026. If you run payroll on a global HRIS platform such as SAP, Workday, or Oracle, do not assume the update has been pushed automatically. Verify it with your local configuration team.

The contribution must also appear as a separate, named line item on every employee’s payslip. This is a compliance requirement under Act 4, not an administrative courtesy.

PERKESO has also introduced a new combined submission file format for SOCSO, EIS, and SKBBK. The old format remains acceptable until 30 September 2026. From 1 October 2026, only the new format will be accepted. If your payroll provider or HR team handles PERKESO submissions directly, the format transition needs to be in your Q3 2026 compliance calendar.

Area 2: Your Workforce – Who Is Covered and Who Is Not

This is the area where foreign companies most frequently make incorrect assumptions, and where the legal position is more nuanced than it first appears.

The general rule is that LINDUNG 24 Jam applies to all employees covered under the Employees’ Social Security Act 1969 – meaning any person employed under a contract of service or apprenticeship. There is no distinction between local employees and foreign workers. There is no distinction between blue-collar and white-collar staff. There is no distinction based on salary level above the registration threshold.

Employment Pass holders are included. A foreign national holding an EP Category I, II, or III, employed by your Malaysian entity, is subject to the same SOCSO obligations as a Malaysian citizen on the same payroll. The only practical difference is that the contribution is capped at the RM6,000 ceiling – which, given that EP Category I minimum salaries are now RM20,000 per month following the June 2026 policy revision, means the deduction is a fixed RM44.65 regardless of actual salary. The amount is negligible. The obligation is not.

Professional Visit Pass holders are generally excluded. This is an important distinction for foreign companies that regularise the presence of short-term assignees or secondees via PVPs rather than Employment Passes. These individuals are typically not employees of the Malaysian entity in the employment law sense, and they fall outside the SOCSO registration framework accordingly. If you are uncertain about the pass type of a particular individual in your Malaysia operation, this is worth reviewing – the classification of pass type has consequences beyond just SOCSO.

The immigration-coverage interaction for work permit holders merits specific attention for companies with manufacturing or operational workforces. Act A1788 introduced a new section 44b into the principal Act, which provides that a foreign worker is not entitled to LINDUNG 24 Jam benefits if: “the insured person misuses a valid pass or permit issued by the Director General of Immigration or breaches any entry requirements under the Immigration Act 1959/63 [Act 155].”

Read carefully, this provision creates a gap between contribution obligation and coverage entitlement. Your entity continues to deduct and remit contributions for all eligible foreign workers – that obligation is unconditional. But if a worker’s immigration documentation is irregular, a non-employment injury claim can and will be rejected. For companies managing workforces of work permit holders, this is a prompt to review whether workers are employed within the scope of their permits, whether permits are current, and whether any permit conditions relevant to the type of work being performed are being observed. This is not a hypothetical risk; it is a scenario that arises in practice in manufacturing and plantation operations.

Area 3: Your Employees – What They Will Ask

The deduction will appear on the June 2026 payslip for the first time. For some employees – particularly EP holders who were not expecting an additional deduction – this will prompt questions. For foreign workers in operational roles, it may prompt confusion or concern.

Having a clear, accurate internal communication prepared before payslips are distributed is straightforward good practice, and it is considerably easier than managing ad hoc queries after the fact.

The key points employees need to understand are: the deduction is statutory and mandatory; it is funded entirely by the employee (the employer bears no additional contribution cost); and the benefit it provides is genuine 24-hour accident protection – meaning that an injury occurring at home, during a weekend activity, or in a road accident unrelated to commuting is now covered by SOCSO rather than falling entirely on the employee’s own insurance or resources. For the majority of employees, particularly those without separate personal accident coverage, this is a material improvement in their protection.

The Grace Period: A Word of Caution

PERKESO has announced a six-month grace period from 1 June 2026, during which penalties specifically related to SKBBK non-compliance will not be enforced. We would caution against treating this as a reason to delay implementation.

Three reasons. First, the grace period is specific to SKBBK – it does not cover errors in existing SOCSO or EIS contributions that may be discovered in the same audit. A payroll review triggered by SKBBK non-compliance can surface other issues. Second, corrections to historical payroll are administratively burdensome, particularly for entities reporting to regional finance or HR centres that require clean books on a rolling basis. Third, the grace period ends on 30 November 2026 – which is also the period during which the new submission file format becomes mandatory. Leaving both changes until Q4 2026 compounds the risk of operational disruption.

The more straightforward path is to implement correctly from 1 June.

What to Do Now

The actions required are not complex, but they do need to be coordinated across your payroll, HR, and legal functions:

• Confirm with your payroll provider that the updated SOCSO contribution table including the SKBBK column is live for June 2026 processing.

• Verify that the SKBBK deduction will appear as a named line item on employee payslips from June 2026.

• Review your workforce to identify which employees are covered (those under a contract of service), which pass types may be exempt (Professional Visit Pass holders and others not employed by the Malaysian entity), and which foreign workers’ immigration documentation should be reviewed.

• Prepare a short internal communication for employees explaining the new deduction before June payslips are distributed.

• Calendar the submission format transition for Q3 2026 and confirm your payroll provider’s readiness for the October 2026 deadline.

If you have questions about LINDUNG 24 Jam compliance for your Malaysia entity, or would like a review of your current SOCSO registration and contribution structure, please contact us at nadhil@aqranvijandran.com.

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