PERKESO Expands Contribution Ceiling Rate to RM 6,000 Effective 1 Oct 2024
In a significant move to enhance social security for workers, the Social Security Organization (PERKESO) of Malaysia has announced an increase in the contribution ceiling rate from RM 5,000 to RM 6,000, effective October 1, 2024. This adjustment aims to provide greater financial security and benefits to employees across the country.
Why the Change?
PERKESO's decision to raise the contribution ceiling rate comes in response to the evolving economic landscape and the need to align social security contributions with current wage trends. By increasing the ceiling rate, PERKESO ensures that a broader range of income is covered, offering enhanced protection for higher-earning employees.
Impact on Employers and Employees
For employers, this change means adjusting their contribution calculations to accommodate the new ceiling. While this might lead to a slight increase in payroll costs, the long-term benefits of a more secure workforce are invaluable.
For employees, the raised ceiling translates to higher contributions from both the employer and the employee, resulting in more substantial benefits in times of need. This includes improved coverage for medical expenses, disability, and retirement benefits.
What Employers Need to Do
Employers are urged to update their payroll systems to reflect the new contribution ceiling rate of RM 6,000. It is crucial to ensure that both existing and new employees are informed about this change and how it will affect their monthly contributions.
The Bigger Picture
This move by PERKESO underscores the organization's commitment to providing comprehensive social security coverage for all Malaysian workers. By continuously adapting and improving the social security framework, PERKESO is paving the way for a more resilient and secure workforce.
As we approach the effective date of this change, it is essential for both employers and employees to stay informed and prepared for the adjustments. This proactive approach will ensure a smooth transition and continued protection under PERKESO's social security schemes.
Refer perkeso website for Contribution Rate Table: Link to Perkeso website
Remember, compliance isn't just a legal obligation—it's an essential part of responsible business practices. Stay informed, stay compliant, and empower your organization for success.
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