Foreign worker minimum wage & OT rates in Malaysia

The payroll standard we use for foreign workers (pekerja asing): a minimum basic wage of RM 1,700 per month, the daily and hourly rates derived from it, overtime multipliers, and EPFEmployees Provident Fund (KWSP). and PERKESOSocial Security Organisation (SOCSO). contributions.

Last updated: date to be confirmed

Minimum wage and statutory contributions

The standard working week is 45 hours (7.5 hours × 6 days), with 1 rest day per week.

Statutory minimum wage and contributions
Payroll / deduction item Statutory basis
Basic minimum wage RM 1,700 / month
Standard hours 45 hrs / week (7.5 hrs × 6 days)
Rest day policy 1 rest day per week
EPF contribution Employer 2% / Employee 2%
PERKESO contribution Employer RM 39.40 / Employee RM 8.75 (per contribution table)

How overtime (OT) is calculated

Overtime starts from two base figures. The daily rate is the monthly wage divided by 26: RM 65.38. The hourly rate is the daily rate divided by 8: RM 8.17.

OT is then a multiple of the hourly rate: 1.5× on a normal working day (RM 12.26 per hour), 2.0× for work on a rest day (RM 16.35 per hour) and 3.0× for work on a public holiday (RM 24.52 per hour).

Overtime (OT) calculation standard
Overtime category Multiplier Rate
Ordinary rate (per day) 1-day basis RM 65.38 / day
Hourly rate 1-hour basis RM 8.17 / hour
Normal-day OT 1.5× hourly rate RM 12.26 / hour
Rest-day work (rest-day OT) 2.0× hourly rate RM 16.35 / hour
Public holiday work 3.0× hourly rate RM 24.52 / hour

Monthly employer cost estimator

For one worker on the minimum wage, the employer's monthly cost is the basic wage plus the employer's EPF contribution (2%, RM 34.00) and PERKESO contribution (RM 39.40): RM 1,773.40 before overtime. Add OT hours to estimate a full month.

Estimate one month

Estimate
Hours per worker in the month
Basic wage
RM 1,700.00
Employer EPF (2%)
RM 34.00
Employer PERKESO
RM 39.40
Overtime pay
RM 0.00
Estimated cost per worker per worker, per month
RM 1,773.40
Estimated monthly cost, all workers
RM 1,773.40

Estimate only, for planning. It uses the minimum basic wage and the rates above, and does not replace payroll advice for a specific worker.

A worked example

Take one worker on the minimum wage who works 10 hours of overtime on normal working days and 8 hours on a public holiday in the same month.

The normal-day overtime comes to 10 × RM 12.26 = RM 122.60. The public holiday work comes to 8 × RM 24.52 = RM 196.15. Added to the base employer cost of RM 1,773.40, the estimated cost for that month is RM 2,092.15.

The same steps work for any month: multiply the hours in each category by its hourly OT rate, then add the result to the basic wage and the employer contributions. The estimator above does this arithmetic for you.

EPF and PERKESO for foreign workers

EPF (KWSP) is contributed at 2% by the employer and 2% by the employee. PERKESO (SOCSO) is RM 39.40 from the employer and RM 8.75 from the employee, according to the contribution table.

Employee contributions are deducted from the worker's wage. Employer contributions are paid on top of it.

Applying this to your payroll

We give payroll and statutory compliance guidance as part of our existing worker services, alongside PLKSTemporary Employment Visit Pass (Pas Lawatan Kerja Sementara): the work permit. (Pas Lawatan Kerja Sementara) renewal.

Still planning to hire? Start with the foreign worker cost breakdown, which covers the levyAnnual foreign worker levy paid by the employer. (levi), the work permit and the post-arrival costs for each new worker.

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