🇲🇾 Hire in Malaysia: cost, rules and best EOR options
English-speaking, multilingual workforce with competitive wages and a mature shared-services and tech sector, close to Singapore.
- Employer on-costs: 13.95–15.95% of gross salary (on a $60,000 salary, about $68,370–$69,570 total)
- EOR onboarding: not verified; own entity: not verified
- Probation: Customarily 3-6 months by contract; not fixed by statute.
- Currency: Malaysian ringgit (MYR)
- Data confidence: medium, verified 2026-10-05
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What it costs to employ someone in Malaysia
Employer on-costs run roughly 13.95–15.95% on top of gross salary. Derived for Malaysian employees under 60: EPF 12% (wages over MYR 5,000) or 13% (MYR 5,000 and below) + SOCSO 1.75% + EIS 0.2% (both capped at monthly wage MYR 6,000, per secondary source), plus HRDF levy 1% for covered employers with 10+ staff (high end uses EPF 13% + HRDF). Non-citizens are subject to 2% employer EPF from October 2025 (secondary source), so cost is much lower for foreign employees. Excludes paid leave and termination benefits.
| Contribution | Rate | Notes |
|---|---|---|
| EPF (Employees Provident Fund) | 13% (wages up to MYR 5,000) or 12% (above), employees under 60 | PwC: 12% employer / 11% employee for monthly pay over MYR 5,000; 13% for MYR 5,000 and below per secondary sources. Non-citizens subject to prescribed rates from October 2025 (2% each per secondary source). |
| SOCSO (Employment Injury + Invalidity) | 1.75% of wages (max MYR 104.15 per month for both schemes per PwC) | Employee 0.5%; PwC gives MYR 74.40 for EIS-only (employment injury) coverage for older workers. |
| EIS (Employment Insurance System) | 0.2% | Employee also 0.2%; secondary source. |
| HRDF levy | 1% of monthly wages | Employers with 10+ employees in covered sectors (0.5% for some smaller employers; not verified). |
Employer withholds the employee EPF (11%), SOCSO, EIS and monthly tax deductions (PCB/MTD).
Mandatory benefits
- EPF, SOCSO and EIS coverage
- Paid annual leave of 8/12/16 days by service band (Employment Act)
- Sick leave 14/18/22 days and 60 hospitalisation days
- Maternity leave 98 days and paternity 7 days
Employment rules at a glance
| Payroll | Monthly; wages paid within 7 days of the end of the wage period (general knowledge) |
|---|---|
| Probation | Customarily 3-6 months by contract; not fixed by statute. |
| Notice & severance | If contract is silent: 4 weeks (under 2 years), 6 weeks (2-5 years), 8 weeks (over 5 years). Termination benefits for EA-covered employees: 10 days (under 2 years), 15 days (2-5 years) or 20 days (over 5 years) per year of service on retrenchment (general knowledge). |
| Working time | 45 hours per week maximum (Employment Act amended 2022); overtime paid at 1.5x on normal days. |
| Paid leave | 8 days (under 2 years), 12 days (2-5 years), 16 days (over 5 years) of annual leave, plus at least 11 public holidays under the Employment Act (general knowledge). |
| Minimum wage | MYR 1,700 per month from 1 February 2025 for employers with five or more employees and professional activities; smaller employers from 1 August 2025 (Malay Mail / government announcements) - https://www.malaymail.com/news/malaysia/2025/02/01/new-minimum-wage-of-rm1700-takes-effect-today-for-over-43-million-workers/165129 |
Termination
Dismissal without just cause can be challenged at the Industrial Court for reinstatement or compensation. The Employment Act covers all employees since 2022, with some protections limited to those earning up to MYR 4,000.
Employee or contractor in Malaysia?
Contractors are usable; the Employment Act defines employment in substance. Misclassification risk is moderate.
Compare contractor vs employee cost →
Hiring through an EOR in Malaysia
A foreign company needs a Sdn Bhd or EOR to employ locally. EORs handle EPF, SOCSO, EIS and PCB. Timelines not verified.
Typical onboarding: EOR not verified; own entity not verified. MYT, UTC+8 all year with no DST; 12-13 hours ahead of US Eastern.
Providers worth shortlisting
| Provider | Best for | EOR pricing | Coverage | |
|---|---|---|---|---|
| Deel | Companies that want one platform for contractors, EOR and a US PEO, with transparent per-seat list prices. | $599 per EOR employee per month (public list price, checked 2026-10-05) | 150+ countries (vendor claim, per Deel's own and third-party descriptions) | Visit Deel |
| Remote | Teams that want a published price for each product (EOR, global payroll, contractors, contractor of record, US PEO) and an affiliate program with 12-month revenue share. | $699 per employee/month (public list price, checked 2026-10-05) | 90+ countries for EOR (vendor pricing page claim) | Visit Remote |
| Rippling | Companies already running (or willing to adopt) a unified HR, IT and finance platform who want global hiring as an add-on module. | — | Visit Rippling | |
| Oyster | Distributed teams that want published EOR and contractor prices and a long-running affiliate program with tiered revenue share. | $699 per employee/month (public list price, checked 2026-10-05); annual discounts available; refundable deposit required | 120+ countries EOR; contractors in 180+ countries (vendor claim) | Visit Oyster |
| Papaya Global | Mid-size and larger companies that need multi-country payroll orchestration and workforce payments, and will go through a sales process. | 160+ countries (vendor claim as repeated on FlexOffers listing and third-party pages) | Visit Papaya Global | |
| Multiplier | Cost-conscious teams that want EOR priced below $500 per employee with an annual discount. | Third-party summary of Multiplier's pricing: EOR from $459/employee/month on annual contracts and $499 on monthly contracts (not confirmed; multiplier pricing page returned 403 to our fetch) | — | Visit Multiplier |
| Remofirst | Small teams that want the lowest published EOR starting price and a free contractor tier. | Starting at $199 per person/month (public list price, checked 2026-10-05); 'no hidden fees, setup fees, or minimum contract terms' per vendor page | 185+ countries for EOR (vendor claim) | Visit Remofirst |
| Pebl (formerly Velocity Global) | Companies that want an EOR with a tiered reseller/partner program and are comfortable with a recently rebranded vendor. | Third-party reports a flat $399 per employee/month (not confirmed on vendor page; hellopebl.com/pricing returned 404) | 185+ countries (third-party report) | Visit Pebl (formerly Velocity Global) |
Paying and covering your team in Malaysia
Related
FAQ
What are employer contributions in Malaysia?
EPF 12-13%, SOCSO 1.75%, EIS 0.2% and a 1% HRDF levy for covered employers: roughly 14-16%.
Do foreign employees pay EPF?
From October 2025 non-citizens are subject to mandatory EPF at prescribed rates (secondary sources say 2% each).
What is the minimum wage?
MYR 1,700 per month since February 2025.
What notice applies?
Contract terms apply; otherwise 4, 6 or 8 weeks by length of service.