EIS (Employment Insurance System): What It Is, How Much You Contribute & How to Claim
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The Employment Insurance System, or EIS, is Malaysia's compulsory employment-loss protection scheme. Administered by the Social Security Organisation (PERKESO), it provides temporary income support and re-employment assistance when an insured worker loses their job for a qualifying reason.
EIS is also known as Sistem Insurans Pekerjaan (SIP) in Malay and is delivered under PERKESO's LINDUNG KERJAYA programme. It was established under the Employment Insurance System Act 2017 (Act 800) and took effect on 1 January 2018.
The most important rule is the deadline: you must apply within 60 days from the date you lose your employment. PERKESO generally rejects claims submitted after that period, so do not wait for your savings or termination payment to run low before applying.
EIS Malaysia at a glance
| Item | Current rule |
|---|---|
| Scheme administrator | PERKESO / SOCSO |
| Malay name | Sistem Insurans Pekerjaan (SIP) |
| Programme name | LINDUNG KERJAYA |
| Employee contribution | 0.2% of assumed monthly wages |
| Employer contribution | 0.2% of assumed monthly wages |
| Total contribution | 0.4% |
| Contribution wage ceiling | RM6,000 per month |
| Maximum employee contribution | RM11.90 per month |
| Maximum employer contribution | RM11.90 per month |
| Maximum combined contribution | RM23.80 per month |
| Claim deadline | Within 60 days of loss of employment |
| Main cash benefit | Job Search Allowance |
| Payment period | 3 to 6 months, depending on contribution history |
| Monthly Job Search Allowance rates | 80%, 50%, 40%, 40%, 30% and 30% |
| Maximum assumed monthly wage for benefit calculations | RM5,950 |
| Other support | Training funding, training allowance, job matching and career counselling |
| PERKESO service target | Within 14 days after all complete documents are received |
PERKESO raised the contribution wage ceiling from RM5,000 to RM6,000 from 1 October 2024. Employees earning more than RM6,000 still contribute, but their monthly contribution remains capped at RM11.90 each for the employee and employer under the current Act 800 contribution schedule.
EIS is temporary protection rather than a complete emergency fund. Its wage ceiling and maximum six-month payment period may not cover a household's full expenses. A separate liquid buffer can help bridge that gap; StashAway Simple has no minimum amount or lock-in, although it remains an investment product and does not replace EIS.
What is the Employment Insurance System?
EIS is a pooled social-insurance scheme. Employers and insured employees contribute each month, and PERKESO uses the fund to support qualifying workers who lose their jobs.
It performs two jobs:
- Temporary income replacement: The Job Search Allowance replaces part of an eligible worker's assumed monthly wages for three to six months.
- Re-employment support: PERKESO helps beneficiaries return to work through job matching, career counselling, training and the MYFutureJobs employment platform.
EIS is not an individual savings account. Your contributions are not stored in a personal balance that you can withdraw later. Paying into EIS also does not guarantee a payout: the reason for your job loss, your contribution record and your compliance with PERKESO's job-search requirements all matter.
EIS vs SOCSO vs EPF: What is the difference?
EIS, SOCSO and EPF may appear together on a payslip, but they protect against different financial risks.
| Scheme | Main purpose | When it generally pays | Where the money goes |
|---|---|---|---|
| EIS / SIP | Temporary income and re-employment support after eligible job loss | Retrenchment or another qualifying loss of employment | Pooled EIS fund administered by PERKESO |
| SOCSO / PERKESO under Act 4 | Employment-injury, invalidity and related social-security protection | Work-related injury, occupational disease, invalidity or death, depending on the benefit | Pooled social-security fund |
| EPF / KWSP | Long-term retirement savings | Retirement and permitted withdrawals | The member's EPF accounts |
| Employer termination or retrenchment benefits | Compensation arising from employment law, contract or collective agreement | Qualifying termination, retrenchment or lay-off | Paid directly by the employer |
An EIS payment does not cancel other amounts your employer may owe, including unpaid salary, pay in lieu of notice, unused annual leave or a contractual termination package.
Who must contribute to EIS?
EIS generally applies to employees working under a contract of service or apprenticeship in industries covered by Act 800, regardless of whether the agreement is written, oral, expressed or implied.
Workers generally covered
- Malaysian citizens and permanent residents employed in the private sector.
- Full-time, part-time, temporary and contract employees who work under a contract of service.
- Employees aged 18 to 60.
- Eligible local domestic workers. PERKESO's current domestic-worker rules cover Malaysian citizens, permanent residents and temporary residents under Act 800.
Workers generally excluded or exempt
| Worker category | EIS treatment |
|---|---|
| Civil servants | Excluded |
| Employees of statutory bodies and local authorities | Generally excluded |
| Self-employed workers, sole proprietors and freelancers without a contract of service | Excluded |
| Foreign workers | Excluded from Act 800 |
| Foreign domestic workers | Covered under relevant Act 4 protection, but not EIS under Act 800 |
| Employee aged 57 or older who has never previously contributed to EIS | Exempt |
| Employee who has reached age 60 | No longer required to contribute |
Local domestic workers were previously a common source of confusion. Under PERKESO's current domestic-worker protection framework, eligible local domestic workers contribute under both Act 4 and Act 800, while foreign domestic workers are not covered by EIS.
How much do employees and employers contribute to EIS?
The employer contributes 0.2% and the employee contributes 0.2% of the employee's assumed monthly wages. The employer deducts the employee's portion through payroll and remits both portions to PERKESO.
The phrase "assumed monthly wages" is important. EIS uses statutory salary bands rather than multiplying 0.2% by every employee's exact salary to the sen.
EIS contribution table by salary
The table below shows common reference bands from the official contribution schedule.
| Actual monthly wages | Employer contribution | Employee contribution | Total contribution |
|---|---|---|---|
| More than RM1,600 up to RM1,700 | RM3.30 | RM3.30 | RM6.60 |
| More than RM1,900 up to RM2,000 | RM3.90 | RM3.90 | RM7.80 |
| More than RM2,400 up to RM2,500 | RM4.90 | RM4.90 | RM9.80 |
| More than RM2,900 up to RM3,000 | RM5.90 | RM5.90 | RM11.80 |
| More than RM3,900 up to RM4,000 | RM7.90 | RM7.90 | RM15.80 |
| More than RM4,900 up to RM5,000 | RM9.90 | RM9.90 | RM19.80 |
| More than RM5,900 | RM11.90 | RM11.90 | RM23.80 |
Employees earning above RM6,000 do not contribute more than RM11.90 a month. For salaries between the examples above, use PERKESO's full contribution table or contribution calculator rather than estimating from a rounded percentage.
How to identify EIS on your payslip
The deduction may be labelled:
- EIS
- SIP
- PERKESO EIS
- Act 800
It should appear separately from EPF and the SOCSO deduction under Act 4. Only the employee's share should reduce your salary. The employer must fund its own matching contribution.
When a deduction appears missing or incorrect:
- Ask payroll or human resources for your contribution record.
- Keep your payslips, employment contract and salary statements.
- Contact PERKESO to verify whether contributions were registered and paid.
Do this while you are still employed where possible. Contribution problems are easier to correct before a claim becomes urgent.
Who can claim EIS benefits?
Paying EIS contributions is only one part of eligibility. An applicant generally must:
- Be an insured person under Act 800.
- Be aged between 18 and 60 when the loss of employment occurs.
- Have a loss of employment recognised by PERKESO.
- Apply within 60 days from the loss-of-employment date.
- Satisfy the required contribution conditions.
- Be able and available to work.
- Be willing to work and actively seek employment.
- Participate in PERKESO's re-employment placement programme.
For a first claim, the worker normally needs at least 12 monthly contributions within the relevant 24-month eligibility period. That period includes the month in which the loss of employment occurs.
PERKESO decides whether the reason for job loss and contribution record meet the statutory requirements. An employer calling a termination a "resignation" or "mutual separation" does not automatically settle the issue; the underlying documents and facts still matter.
What types of job loss qualify for EIS?
Act 800 distinguishes an involuntary or protected loss of employment from an ordinary decision to leave a job.
Situations that generally qualify or may qualify
| Reason employment ended | General treatment | What to keep |
|---|---|---|
| Retrenchment or redundancy | Generally qualifies | Retrenchment letter and final payslips |
| Business closure or bankruptcy | Generally qualifies | Closure or termination notice |
| Workplace closure caused by a natural disaster, fire, gas leak, riot or similar event | May qualify when employment actually ends | Employer notice and supporting evidence |
| Voluntary Separation Scheme (VSS) | Recognised as a potential loss of employment | Formal VSS offer and acceptance |
| Formal Mutual Separation Scheme (MSS) with documented terms | May qualify | Signed agreement showing the terms and reason |
| Constructive dismissal or deliberate employer breach of contract | May qualify | Correspondence, contract and legal or industrial-relations records |
| Resignation due to threats or sexual harassment at work | May qualify | Reports, messages, complaints and witness records |
| Resignation after being ordered to perform dangerous work outside the job scope | May qualify | Written instructions and safety evidence |
Situations generally excluded
| Reason employment ended | General treatment |
|---|---|
| Ordinary voluntary resignation | Excluded |
| Expiry of a fixed-term contract | Excluded |
| Completion of the work or project specified in the contract | Excluded |
| Mandatory retirement | Excluded |
| Dismissal for misconduct | Excluded |
| Termination by mutual consent without documented terms and conditions | Excluded |
A structured VSS or MSS is not the same as an informal agreement to leave. Ask for the reason, payment terms and effective date to be stated clearly in writing before signing. PERKESO has the final authority to determine whether a qualifying loss of employment occurred.
How long must you contribute before claiming?
The number of Job Search Allowance months for a first claim depends on how many monthly contributions were made within the 24-month eligibility period immediately preceding the loss of employment, including the month of job loss.
First EIS claim contribution requirements
| Monthly contributions within the 24-month eligibility period | Potential payment period |
|---|---|
| 12 to 15 months | 3 months |
| 16 to 19 months | 4 months |
| 20 to 23 months | 5 months |
| 24 months | 6 months |
The contributions do not have to be made in consecutive months. However, contributions already counted for an approved claim cannot be reused for a later claim.
Second and subsequent claims use progressively longer eligibility periods and higher contribution requirements. The complete first-to-twelfth-claim schedule appears in the Fourth Schedule of Act 800.
What EIS benefits can you claim?
EIS combines cash payments with services intended to help the insured person return to work.
| Benefit | Who it is for | Amount or support |
|---|---|---|
| Job Search Allowance (JSA) | An insured person who loses their employment and satisfies the contribution conditions | 80%, 50%, 40%, 40%, 30% and 30% of assumed monthly wages, paid for 3 to 6 months |
| Reduced Income Allowance (RIA) | An insured person with two or more jobs who loses one or more, but not all, of those jobs | Calculated using the same rate schedule and paid as a lump sum |
| Early Re-employment Allowance (ERA) | A JSA recipient who starts a new job before the JSA period ends | 25% of the remaining unpaid JSA entitlement, subject to the rules |
| Training Fee | An eligible beneficiary approved for vocational training | Up to RM4,000, paid to the approved training provider |
| Training Allowance | An eligible beneficiary attending approved training | RM10 to RM20 for each training day, subject to attendance |
| Job placement and career counselling | EIS applicants and beneficiaries | Job matching, career guidance and employment support through PERKESO and MYFutureJobs |
A recipient of Reduced Income Allowance is not generally eligible for EIS training benefits because they remain employed in at least one job.
Act 800 also allows certain benefits already due to be paid to an eligible dependant or authorised person if an insured person dies, falls into a coma or becomes of unsound mind during the claim or benefit period.
How is the Job Search Allowance calculated?
JSA is based on the employee's assumed monthly wage, derived from the statutory wage bands and contribution record. It is not necessarily the same as the employee's exact basic or gross salary.
The allowance is front-loaded: the first month pays the highest percentage, followed by lower rates as the entitlement period continues.
Monthly Job Search Allowance rates
| Benefit month | Percentage of assumed monthly wage |
|---|---|
| Month 1 | 80% |
| Month 2 | 50% |
| Month 3 | 40% |
| Month 4 | 40% |
| Month 5 | 30% |
| Month 6 | 30% |
EIS Job Search Allowance payment schedule
Figure 1: The Job Search Allowance steps down from 80% of assumed monthly wages in month one to 30% by months five and six, paid for up to six months.
Someone entitled to only three months receives the first three rates. Someone entitled to four or five months receives the rates up to the relevant month.
Worked example 1: Employee earning RM3,000
For actual wages of RM3,000, the statutory corresponding assumed monthly wage is RM2,950.
Assume the employee has enough qualifying contributions for all six months.
| Month | Rate | Estimated JSA |
|---|---|---|
| 1 | 80% | RM2,360 |
| 2 | 50% | RM1,475 |
| 3 | 40% | RM1,180 |
| 4 | 40% | RM1,180 |
| 5 | 30% | RM885 |
| 6 | 30% | RM885 |
| Six-month total | RM7,965 |
Worked example 2: Employee earning RM6,000 or more
The maximum assumed monthly wage under the amended schedule is RM5,950, even though the contribution wage ceiling is commonly described as RM6,000.
Assume the employee qualifies for all six months.
| Month | Rate | Maximum JSA |
|---|---|---|
| 1 | 80% | RM4,760 |
| 2 | 50% | RM2,975 |
| 3 | 40% | RM2,380 |
| 4 | 40% | RM2,380 |
| 5 | 30% | RM1,785 |
| 6 | 30% | RM1,785 |
| Maximum six-month total | RM16,065 |
The distinction between the RM6,000 contribution ceiling and the RM5,950 maximum assumed wage comes from the Employment Insurance System (Amendment) Act 2024.
These examples are estimates, not guaranteed payouts. PERKESO determines the final assumed wage, contribution eligibility, payment duration and approval.
How to claim EIS benefits online
Applications are submitted through the LINDUNG KERJAYA benefits portal.
Step 1: Confirm your official loss-of-employment date
Use the date on your termination, retrenchment, VSS or MSS document. The 60-day claim period runs from the loss-of-employment date, not from the date your final salary or termination payment reaches your bank account.
Step 2: Prepare the required documents
PERKESO's current online-application guide lists these core documents:
- MyKad, front and back.
- Termination letter or other proof of loss of employment.
- Payslips for the previous six months.
- Personal bank statement showing your name and account details.
Depending on the case, also prepare:
- Employment contract or offer letter.
- VSS or MSS agreement.
- Employer closure notice.
- Evidence supporting constructive dismissal, threats, sexual harassment or dangerous work.
- Industrial-relations, police, medical or legal documents where relevant.
Use clear, complete copies. An unsigned letter, unreadable bank statement or inconsistent termination date can delay verification.
Step 3: Create or log in to your LINDUNG KERJAYA account
Complete your personal information, employment history, loss-of-employment details and bank information. Upload the requested documents and review every entry before submitting.
Save your application or reference number.
Step 4: Complete your MYFutureJobs profile
Create or update your profile on MYFutureJobs with your:
- Employment history.
- Education and qualifications.
- Skills.
- Preferred roles and locations.
- Résumé.
The profile is part of the re-employment process, not an optional job-board account.
Step 5: Cooperate with PERKESO's Employment Services Officer
You may be asked to participate in:
- Career counselling.
- Job matching.
- Interviews.
- Employability programmes.
- Approved skills or vocational training.
Step 6: Submit ongoing job-search reports
Initial approval does not guarantee every later payment. Continue reporting your job-search activity and complying with PERKESO's instructions for as long as you receive JSA.
What happens after you submit a claim?
PERKESO will:
- Verify that a loss of employment occurred.
- Decide whether the reason is covered under Act 800.
- Check your contribution history.
- Determine the benefit type and payment period.
- Request further documents when information is incomplete or disputed.
- Enrol or engage you in the re-employment placement programme.
- Credit approved payments to your registered bank account.
PERKESO's client charter sets a target to process and pay JSA, RIA, Training Allowance and ERA within 14 days after all required documents are complete. It also targets processing the Training Fee within 14 days.
That is a service target, not an automatic approval guarantee. A disputed job-loss reason or missing contribution record can take longer to resolve.
What can suspend or stop EIS payments?
Payments may be suspended, terminated or recovered when a beneficiary:
• Starts a new job but fails to inform PERKESO.
• Is no longer able, available or willing to work.
• Stops actively seeking employment.
• Fails to complete required monthly reporting.
• Misses counselling, placement or training requirements without an accepted reason.
• Refuses suitable participation in the re-employment programme.
• Provides false, incomplete or misleading information.
• Receives a payment after entitlement has ended.
A JSA recipient who accepts an employment offer must notify PERKESO within seven days of accepting it. Continuing to receive JSA without disclosure can lead to repayment action.
What happens if you find a job early?
Returning to work before the JSA period ends can make you eligible for the Early Re-employment Allowance, equal to 25% of the remaining unpaid JSA.
For example, suppose RM5,400 of approved JSA remains unpaid when you start a new job:
RM5,400 × 25% = RM1,350
The potential ERA would be RM1,350, subject to PERKESO's calculation and confirmation that you have started the new employment.
Prepare your offer letter and proof of reporting for duty. Notify PERKESO within the required period rather than waiting for the next monthly claim.
Can you claim EIS and retrenchment benefits from your employer?
Potentially, yes. They are separate protections.
EIS is paid by PERKESO under Act 800. Retrenchment or termination benefits are paid by the employer under the applicable employment law, employment contract or collective agreement.
An employee may also be owed:
• Salary up to the final working day.
• Payment in lieu of notice.
• Unused annual leave.
• Contractual severance.
• Statutory termination or lay-off benefits, where covered.
For employees covered by the Employment (Termination and Lay-Off Benefits) Regulations 1980, the general minimum rates are:
| Continuous service | Minimum termination benefit |
|---|---|
| Less than 2 years | 10 days' wages for each year of service |
| 2 years to less than 5 years | 15 days' wages for each year of service |
| 5 years or more | 20 days' wages for each year of service |
The employer should pay qualifying termination benefits within seven days from the termination date and provide a written calculation.
Coverage needs care. The Department of Labour Peninsular Malaysia states that employees earning more than RM4,000 a month, other than manual employees, are not eligible to claim statutory termination or lay-off benefits through this provision. A contract or collective agreement may still provide better benefits.
The Employment Act framework above applies to Peninsular Malaysia and Labuan. Sabah and Sarawak have separate labour ordinances, so employees there should check with their respective labour departments.
Common EIS claim mistakes to avoid
1. Applying after 60 days. Start the claim as soon as the job ends.
2. Assuming every resignation qualifies. Ordinary voluntary resignation is excluded.
3. Signing a vague mutual-termination letter. The terms and reason should be documented.
4. Using the wrong loss-of-employment date. Use the official employment end date.
5. Submitting an unsigned or unreadable termination letter.
6. Uploading a bank account that is not in the applicant's name.
7. Leaving out six months of payslips.
8. Failing to complete the MYFutureJobs profile.
9. Ignoring monthly job-search reporting.
10. Not telling PERKESO after accepting a job.
11. Calculating JSA from exact gross salary instead of assumed monthly wages.
12. Assuming the RM6,000 wage ceiling means a RM6,000 assumed wage. The maximum assumed wage is RM5,950.
EIS claim checklist
EIS Malaysia claim checklist
Figure 2: A 14-step checklist covering everything to prepare before and during an EIS claim, save or screenshot this for reference.
Frequently asked questions about EIS Malaysia
What does EIS stand for in Malaysia?
EIS stands for Employment Insurance System. Its Malay name is Sistem Insurans Pekerjaan, or SIP. PERKESO delivers the scheme under the LINDUNG KERJAYA programme.
Is EIS the same as SOCSO?
No. PERKESO, commonly called SOCSO in English, administers both, but the schemes cover different risks. EIS supports eligible loss of employment, while the schemes under Act 4 mainly cover employment injury, invalidity and related risks.
How much is deducted for EIS?
The employee contributes 0.2% of assumed monthly wages according to the statutory contribution table. The employer contributes a matching 0.2%.
What is the maximum EIS contribution?
The maximum is RM11.90 a month from the employee and RM11.90 from the employer, or RM23.80 combined.
What is the EIS salary ceiling?
The contribution wage ceiling is RM6,000 a month. For benefit calculations, the highest statutory assumed monthly wage is RM5,950.
Can I claim EIS if I resign?
An ordinary voluntary resignation generally does not qualify. A resignation connected to threats, sexual harassment, a serious employer breach or dangerous work outside the job scope may qualify if supported by evidence and accepted by PERKESO.
Can I claim EIS after VSS or MSS?
A formal VSS can qualify. A documented MSS with clear terms may qualify, while a mutual termination without terms and conditions is excluded. PERKESO decides each case based on the agreement and circumstances.
Can I claim when a fixed-term contract expires?
Generally no. The normal expiry of a fixed-term contract or completion of the work stated in the contract is excluded.
Can I claim if I am dismissed for poor performance?
It depends on the legal and factual reason recorded for the termination. Dismissal for misconduct is excluded. Other employer-initiated terminations are assessed by PERKESO based on the documents and circumstances.
Can domestic workers contribute to EIS?
Eligible local domestic workers who are Malaysian citizens, permanent residents or temporary residents can be covered under Act 800. Foreign domestic workers are not covered by EIS.
Can I claim EIS more than once?
Yes, provided you meet the contribution conditions for the later claim. Contributions already counted for an approved claim cannot be counted again.
How many months does EIS pay?
JSA is paid for three to six months. The duration depends on the number of qualifying contributions and whether it is a first or subsequent claim.
How much can I receive?
JSA pays 80% of assumed monthly wages in the first month, followed by 50%, 40%, 40%, 30% and 30%. The maximum assumed monthly wage is RM5,950, making the maximum six-month JSA illustration RM16,065.
How long does an EIS claim take?
PERKESO's client charter targets processing and payment within 14 days after all complete documents are received. Cases involving missing information, disputed termination reasons or contribution issues can take longer.
What if my employer did not pay my EIS contributions?
Keep your payslips, employment contract, bank salary records and evidence of any EIS deductions. Contact PERKESO for contribution verification and enforcement assistance. Do not assume you have no remedy solely because the employer failed to remit a deduction.
EIS protects your income temporarily, not permanently
EIS can soften the immediate shock of retrenchment, but it does not replace a full salary or provide indefinite support. The scheme is capped, steps down each month and ends after three to six months.
Apply within 60 days, keep complete employment records and stay active in PERKESO's re-employment programme. Those three actions have the biggest practical effect on whether a valid claim moves smoothly.
Outside EIS, keep short-term expenses in an accessible emergency buffer rather than investing money you may need next month. Once that buffer is secure, money intended for longer-term goals can be invested through a diversified portfolio such as General Investing powered by StashAway, while investors who prefer choosing individual funds can use StashAway ETF Explorer. Neither is a substitute for EIS or emergency savings.
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