The Employment Insurance System, or EIS, is Malaysia’s national employment insurance scheme for private sector employees. It provides short-term income support and job search help to eligible employees who lose their employment through no serious fault of their own.
Under this scheme, employers deduct an EIS contribution from employees’ payroll each month and add an equal amount. PERKESO manages these contributions and channels the fund to support employees who are looking for a new job in Malaysia.
Table of Contents
- Why Is There An EIS Contribution In Payroll And Who Must Contribute?
- How Much Is the EIS Contribution And When Is It Paid?
- When Can An Employee Claim EIS In Malaysia?
- What Benefits Do Employees Get From EIS In Malaysia?
- What Is The EIS Emergency Checklist For Employees Who Lose A Job?
- Conclusion
- Frequently Asked Questions (FAQ)
Why Is There An EIS Contribution In Payroll And Who Must Contribute?
Most employees in Malaysia between 18 and 60 must contribute to EIS, with some specific exclusions under employment law. This rule shows which employees are covered by the scheme if their job is terminated.
For every monthly payroll, the employer calculates the EIS contribution using the official rate and clearly displays it on the payslip so both parties can confirm that the contributions are correct and up to date.
How Much Is the EIS Contribution And When Is It Paid?
Under EIS, the total contribution is 0.4 per cent of assumed monthly wages, shared between employer and employee and shown clearly in payroll.
EIS Contribution Summary
| Item | Details |
| Contribution rate | Total 0.4 per cent of assumed monthly wages |
| Who pays | Split equally between employer and employee |
| How it appears in payroll | Employee sees a small EIS deduction in payroll; employer adds a matching amount |
| Payment deadline | Usually paid to PERKESO by the 15th of the following month, together with other statutory payroll items |
| Why timing matters | Late payment can delay access to EIS support and other benefits |
Example:
| Monthly wages (RM) | Employer contribution (0.2%) | Employee contribution (0.2%) | Total EIS contribution (0.4%) |
| 2,000 | RM4.00 | RM4.00 | RM8.00 |
| 3,500 | RM7.00 | RM7.00 | RM14.00 |
| 6,000 | RM12.00 | RM12.00 | RM24.00 |
When Can An Employee Claim EIS In Malaysia?
An employee can normally claim EIS after a genuine loss of employment, such as retrenchment, redundancy or business closure. In these cases, the fund helps to soften the financial impact.
In most situations, employees cannot claim EIS if they resign voluntarily or are dismissed for serious misconduct. The scheme is designed to support those who lose employment involuntarily.
What Benefits Do Employees Get From EIS In Malaysia?
The main EIS benefits for employees in Malaysia provide a mix of income support and career support:
Job Search Allowance (JSA)
Temporary income when a job is lost and eligibility and contribution conditions are met.
Reduced Income Allowance (RIA)
Partial income if a person has more than one job and loses one of them, as long as there is a sufficient contribution record.
Early Re-Employment Allowance (ERA)
An extra payment is made if someone finds new employment before the Job Search Allowance period ends.
Training Fee (TF) and Training Allowance (TA)
Help to pay for approved courses and a small allowance while attending, to upgrade skills and improve future employment prospects in Malaysia.
Job Search Support and Employment Services
Practical support with job matching, guidance and referrals through PERKESO so people are not facing the Malaysian job market alone.
What Is The EIS Emergency Checklist For Employees Who Lose A Job?
Before the final working day
- Review recent payroll slips and confirm the EIS contribution line next to EPF and SOCSO.
- Confirm your last working day and the stated reason for the loss of employment in the letter.
- Update your contact details with HR in case contribution records or documents need correction.
In the first week after leaving
- File copies of your identity card, employment contract, termination letter, latest payroll slips and bank details.
- List your fixed monthly commitments to see how much income support you need from savings, temporary job income and EIS benefits.
- Log every job application so you can show an active job search during any claim.
When ready to claim
- Start your claim through the official PERKESO channels, such as the EIS (SIP) portal.
- Contact HR or the payroll team if contributions or employment dates look incomplete.
- Request confirmation from your employer if you are unsure whether all contributions have been paid correctly.
Conclusion
Using a connected HRMS keeps information, payroll data and contribution records in one place. This makes it easier for HR to confirm contribution history, prepare documents and give support when someone needs to rely on EIS.
A solution like TimeTec HR connects attendance, leave, payroll and profiles in Malaysia. This reduces manual work and keeps records reliable.
Frequently Asked Questions (FAQ)
1. Can an employee in Malaysia claim EIS after resigning?
Generally, an employee cannot claim EIS after resigning voluntarily. The scheme is meant to support those who lose employment involuntarily, such as through retrenchment or closure of the business, not resignation or dismissal for serious misconduct.
2. How can employees check if the employer is paying EIS contributions correctly?
Employees can check the payslip or payroll slip for the EIS contribution line each month. If the amount looks unusual or anything is unclear, they should ask the HR or payroll team for a simple statement of contributions and service dates. This gives a clear view of the record before they need to claim.