Hire in Malaysia

Malaysia, located in Southeast Asia, is separated by the South China Sea into two non-contiguous regions: the Peninsula Malaysia region bordering Thailand (i.e. West Malaysia) and the Malaysia Borneo region bordering Indonesia and Brunei (i.e. East Malaysia). In the last decade, as it moved up the industry value chain from an oil and gas exporter, Malaysia has emerged as an attractive regional hub for services including financial services, information, and communications technology (ICT), and logistics sectors.

 

*Please note that the official currency is the currency of remuneration when employed through WorkMotion in Malaysia.

Onboard your talent in Malaysia

in 10 minutes

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Accelerated onboarding

Fast-track your talent onboarding while ensuring 100% compliance with local regulations.

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Net salary calculator

Calculate net salary post deductions and compare it with the salary in other countries instantly.

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Guidance & payroll management

Receive process support by an experienced team of experts & pay your talent on time and in their local currency

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Hire in Malaysia through an

EOR

Easily onboard your remote talent in Malaysia through our Employer of Record (EOR) solution. Our subsidiaries and network partners make this process fast and 100% compliant.

A quick overview of Malaysia

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Cost of living index

$$ (93 of 139 countries)

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Currency

Ringgit (MYR, RM)

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Payroll frequency

Monthly

Basic facts

Malaysia, located in Southeast Asia, is separated by the South China Sea into two non-contiguous regions: the Peninsula Malaysia region bordering Thailand (i.e. West Malaysia) and the Malaysia Borneo region bordering Indonesia and Brunei (i.e. East Malaysia). In the last decade, as it moved up the industry value chain from an oil and gas exporter, Malaysia has emerged as an attractive regional hub for services including financial services, information, and communications technology (ICT), and logistics sectors.

 

*Please note that the official currency is the currency of remuneration when employed through WorkMotion in Malaysia.

Capital

Kuala Lumpur

Official language/s

Bahasa Malay

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Population

34.30 million (2023 est.)

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VAT - standard rate

6%

The national holidays mentioned below are valid for the year 2025.

January 1New Year’s DayNational except Johor, Kedah, Kelantan, Perlis, & Terengganu
January 14YDPB Negeri Sembilan's BirthdayNegeri Sembilan
January 27Israk and MikrajKedah, Negeri Sembilan, Perlis, & Terengganu
January 29Chinese New YearMovable
February 1Federal Territory DayKuala Lumpur, Labuan, & Putrajaya
February 11ThaipusamJohor, Kedah, Kuala Lumpur, Negeri Sembilan, Penang, Perak, Putrajaya & Selangor
February 20Hari Pengisytiharan Tarikh KemerdekaanMelaka
March 2Awal RamadanJohor, Kedah, & Melaka
March 4Installation of Sultan TerengganuTerengganu
March 18Nuzul Al-QuranMovable - National except Johor, Kedah, Melaka, Negeri Sembilan, Sabah & Sarawak
March 23Sultan of Johor's BirthdayJohor
March 31 - April 2Hari Raya AidilfitriMovable
April 18Good FridayMovable
April 26Sultan of Terengganu's BirthdayTerengganu
May 1Labor DayNational except Johor, Kedah, Kelantan & Terengganu
May 12Wesak DayNational except Johor, Kedah, Kelantan & Terengganu
May 17Raja Perlis' BirthdayPerlis
May 22Hari Hol PahangPahang
May 30Harvest FestivalLabuan & Sabah
May 31Harvest Festival HolidayLabuan & Sabah
June 1Hari GawaiSarawak
June 2Hari Gawai HolidaySarawak
June 2Agong's BirthdayMovable - First Monday of June
June 6Arafat DayKelantan & Terengganu
June 7Hari Raya HajiMovable
June 8Hari Raya Haji HolidayKedah, Kelantan, Perlis, & Terengganu
June 22Sultan of Kedah's BirthdayKedah
June 27Awal MuharramMovable - National except Johor
July 7Georgetown World Heritage City DayPenang
July 12Penang Governor's BirthdayPenang
July 22Sarawak DaySarawak
July 30Sultan of Pahang's BirthdayPahang
July 31Hari Hol Almarhum Sultan IskandarJohor
August 24Melaka Governor's BirthdayMelaka
August 31Merdeka Day
September 5Prophet Muhammad's BirthdayMovable - National except Johor, Kedah, Kelantan & Terengganu
September 15Malaysia Day Holiday
September 16Malaysia Day
September 29Sultan of Kelantan's BirthdayKelantan
September 30Sultan of Kelantan's Birthday HolidayKelantan
October 4Sabah Governor's BirthdaySabah
October 11Sarawak Governor's BirthdaySarawak
October 20DeepavaliMovable - National except Sarawak
November 7Sultan of Perak's BirthdayPerak
December 11Sultan of Selangor's BirthdaySelangor
December 24Christmas Eve
December 25Christmas

The approximate time for sharing the contract with an employee in Malaysia is 6 business days assuming no special requests or changes to our standard employment contract. Any such requests or changes would need to undergo internal and external review, directly leading to a time delay.

NOTE: This number is subject to change and is only an estimation of the Contract Sharing Time. The estimated Contract Sharing Time begins from the moment that WorkMotion has received all required information from both the client and the employee.

  • There is no paternity leave in Malaysia.
  • There is no provision for a statutory bonus in Malaysia.
  • Amended OSHA covers employees working from home.
  • The Employment Amendment Act now allows an employee to apply in writing to their employer for a flexible working arrangement to vary their hours, days, or place of work

Social security benefits such as disability, retirement, medical payments, and survivors’ benefits are provided by the Social Security Organization and the Employees Provident Fund (EPF). 

Employers are required to pay monthly contributions for each eligible employee according to the rate specified under the Employees’ Social Security Act, 1969. These contributions are divided into two types, namely:

  • Category 1: Below 60 years of age for Employment Injury Scheme and the Invalidity Scheme;
  • Category 2: 60 years and above.

 

Employer Contributions for Malaysian Citizens and Permanent Residents (Mandatory)
Contribution Items Category 1: Below Age 60 Category 2: Above Age 60
Employment Injury Scheme and the Invalidity Scheme
  • 1.75%
  • 1.25%
Employment Insurance System*
  • 0.2%
Employee Provident Fund
  • Salary below MYR 5000 – 13%
  • Salary above MYR 5000 – 12%
  • Non-Malaysians (registered as members after August 1998) – MYR5
  • Salary below MYR 5000 – 6.5%**
  • Salary above MYR 5000 – 6%**
  • Non-Malaysians (registered as members after August 1998) – MYR5
  • No salary limit – 4%

*All employees 18 to 60 years have to contribute. Employees aged 57 and above who have no prior contributions before the age of 57 are exempt. Contribution rates are capped at an assumed monthly salary of MYR 4000.

** Only for Permanent Residents and Non-Malaysians (registered as members before August 1998).

Working Hours

The Malaysia workweek is 40 hours, with a standard workday of eight hours. The maximum number of work hours is 45 hours in a week. Workers are entitled to one rest day for every six days worked, and cannot be compelled to work on that rest day.

 

Overtime

Work hours should not exceed more than 45 per week. If employers request extra hours, they must pay 1.5 times the employee’s regular wages.

The minimum guidelines for overtime pay are:

  • Extra hours worked on a normal working day – 150%;
  • Rest days – 200%;
  • Public holidays – 300%.

 

Probation Period

There is no law governing the length of the probationary period. It depends entirely on the employment contract agreed upon between the employer and the employee. The duration period for probation is usually from a period of three to 12 months.

 

Termination Notice Period

The length of such notice is the same for both employer and employee and is determined by a provision made in writing for such notice in the terms of the contract of service, or, in the absence of such provision in writing, and should not be less than:

Service Period Notice Period
Less than 2 years of service Minimum 4 weeks
2 years or more but less than 5 years of service Minimum 6 weeks
5 years of service or more Minimum 8 weeks
Working Hours

The Malaysia workweek is 40 hours, with a standard workday of eight hours. The maximum number of work hours is 45 hours in a week. Workers are entitled to one rest day for every six days worked, and cannot be compelled to work on that rest day.

 

Overtime

Work hours should not exceed more than 45 per week. If employers request extra hours, they must pay 1.5 times the employee’s regular wages.

The minimum guidelines for overtime pay are:

  • Extra hours worked on a normal working day – 150%;
  • Rest days – 200%;
  • Public holidays – 300%.

 

Probation Period

There is no law governing the length of the probationary period. It depends entirely on the employment contract agreed upon between the employer and the employee. The duration period for probation is usually from a period of three to 12 months.

 

Termination Notice Period

The length of such notice is the same for both employer and employee and is determined by a provision made in writing for such notice in the terms of the contract of service, or, in the absence of such provision in writing, and should not be less than:

Service Period Notice Period
Less than 2 years of service Minimum 4 weeks
2 years or more but less than 5 years of service Minimum 6 weeks
5 years of service or more Minimum 8 weeks

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Social security benefits such as disability, retirement, medical payments, and survivors’ benefits are provided by the Social Security Organization and the Employees Provident Fund (EPF). 

Employers are required to pay monthly contributions for each eligible employee according to the rate specified under the Employees’ Social Security Act, 1969. These contributions are divided into two types, namely:

  • Category 1: Below 60 years of age for Employment Injury Scheme and the Invalidity Scheme;
  • Category 2: 60 years and above.

 

Employer Contributions for Malaysian Citizens and Permanent Residents (Mandatory)
Contribution Items Category 1: Below Age 60 Category 2: Above Age 60
Employment Injury Scheme and the Invalidity Scheme
  • 1.75%
  • 1.25%
Employment Insurance System*
  • 0.2%
Employee Provident Fund
  • Salary below MYR 5000 – 13%
  • Salary above MYR 5000 – 12%
  • Non-Malaysians (registered as members after August 1998) – MYR5
  • Salary below MYR 5000 – 6.5%**
  • Salary above MYR 5000 – 6%**
  • Non-Malaysians (registered as members after August 1998) – MYR5
  • No salary limit – 4%

*All employees 18 to 60 years have to contribute. Employees aged 57 and above who have no prior contributions before the age of 57 are exempt. Contribution rates are capped at an assumed monthly salary of MYR 4000.

** Only for Permanent Residents and Non-Malaysians (registered as members before August 1998).