New laws require goods/food delivery gig workers to register under Self-Employment Social Security Scheme from 1 October 2021

New laws coming into force on 1 October 2021 will require self-employed goods and food delivery workers to be registered under the Self-Employment Social Security Act 2017 (“the SESS Act”) and contribute to the fund under the Self-Employment Social Security Scheme.

The Self-Employment Social Security Scheme was introduced to provide protection against employment injuries including occupational diseases and accidents during work-related activities for individuals who are self-employed under the SESS Act. It was initially compulsory only for gig workers in the passenger transportation sector (taxi, e-hailing, and bus drivers), but has since been expanded to other sectors, including goods and food delivery gig workers. These latest amendments now make registration compulsory for all goods and food delivery gig workers.

In July this year, the Social Security Organisation (Socso) announced that Foodpanda and Grab Malaysia had registered its delivery riders under the SPS Lindung Scheme, to provide social safety protection to these gig workers. However, Socso did note that only 6.1% of gig workers were contributing to Socso, and that Socso had no regulatory power to compel delivery platforms to provide a social protection scheme for self-employed individuals or gig workers.

The following are the subsidiary legislation under the SESS Act which come into force on 1 October 2021:

  1. Self-Employment Social Security (Amendment of First Schedule) Order 2021 [P.U.(A) 371/2021].
  2. Self-Employment Social Security (Rates of Contribution for Persons Carrying Out Service of Carriage and Delivery of Goods or Food) Regulations 2021 [P.U.(A) 372/2021] (“the Rates of Contribution Regulations).
  3. Self-Employment Social Security (Amendment) (No. 2) Regulations 2021 [P.U.(A) 373/2021].

Pursuant to the Rates of Contribution Regulations, “every person who carries out service of carriage and delivery of goods or food” is required to contribute to Socso at the rates specified in the Schedule, based on monthly earnings. In summary, these rates are as follows:

Monthly earningsContribution/monthContribution/year
RM1,050RM13.10RM157.20
RM1,550RM19.40RM232.80
RM2,950RM36.90RM442.80
RM3,950RM49.40RM592.80

Leave a Reply

Your email address will not be published. Required fields are marked *