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EPF and PERKESO for foreign workers: an employer's guide
Last updated: Tai Industries
In our payroll standard for foreign workers (pekerja asing), EPF is contributed at 2% by the employer and 2% by the employee, and PERKESO is RM 39.40 from the employer and RM 8.75 from the employee. On the minimum wage of RM 1,700, the employer's share adds RM 34.00 and RM 39.40 a month, for a base cost of RM 1,773.40 per worker.
What are EPF and PERKESO?
EPF (KWSP) is the Employees Provident Fund. PERKESO (SOCSO) is the Social Security Organisation. Both are statutory contributions that sit alongside the basic wage on a payslip.
How much is contributed for a foreign worker?
| Contribution | Employer | Employee |
|---|---|---|
| EPF (KWSP) | 2% | 2% |
| PERKESO (SOCSO) | RM 39.40 | RM 8.75 |
The PERKESO amounts follow the contribution table.
Who pays which part?
There are two shares. The employee's share is deducted from the worker's wage. The employer's share is paid by the employer on top of the wage, so it is part of the true cost of employing the worker.
What does this add to the monthly cost of one worker?
For a worker on the minimum basic wage:
| Monthly employer cost | Amount |
|---|---|
| Basic wage | RM 1,700 |
| Employer EPF (2%) | RM 34.00 |
| Employer PERKESO | RM 39.40 |
| Total before overtime | RM 1,773.40 |
Overtime is added on top. The hourly rate is RM 8.17, and OT is paid at 1.5×, 2.0× or 3.0× that rate depending on the day. Our foreign worker minimum wage and OT rates page includes an estimator for a full month.
How do these fit with the other costs of a foreign worker?
EPF and PERKESO are monthly payroll costs. They are separate from the permit costs: the levy (levi) and the PLKS (Pas Lawatan Kerja Sementara) work permit are annual government fees, and Fomema and insurance follow the worker's arrival. Those are set out in the foreign worker cost breakdown.
How can I be sure my payroll is compliant?
Check each payslip against the figures above: the basic wage, the hours worked, the OT multiplier for each day, and both contributions. Tai Industries gives payroll and statutory compliance guidance as part of our existing worker services. If you would like us to look at your situation, contact us.