Malaysia: Proposed employment insurance plan to help 57,000 for a start
Source: Asia Insurance Review | Nov 2017
Around 57,000 people who lost their jobs are projected to be among the first to be eligible for benefits when the interim Employment Insurance System (EIS) is launched next year.
Human Resources Minister Richard Riot Jaem, said stakeholders have agreed that the contribution rate of the people-centric scheme be reduced to 0.2% from an earlier proposed 0.5%, which would be contributed equally by both employers and employees.
“This is the lowest rate of contribution in the world,” he said. Funds to be collected next year are projected at MYR479 million (US$114 million).
Prime Minister Najib Razak had announced the EIS in March, but ran into opposition with dissenters arguing that the contribution rate was too high with some also questioning the need for such a scheme.
Mr Riot said that the objective of the EIS, to be managed by the Social Security Organisation, is to provide immediate financial assistance, enabling those who lose their jobs to cover their living expenses during the transition period until they obtain suitable employment. A