EIS Malaysia Guide 2026: Employment Insurance System Contributions, Benefits & Claim Process
Complete guide to EIS (SIP) Malaysia — Employment Insurance System under PERKESO. Learn contribution rates, eligibility for job loss allowance, income reduction allowance, re-employment programmes, and how to file a claim after retrenchment.
Most Malaysian employees notice a small deduction labelled "EIS" on their payslip and think little of it. At only 0.2% of your monthly salary — often just a few ringgit — it is easy to ignore. But if you ever lose your job unexpectedly, those few ringgit could translate into monthly financial support for up to six months.
EIS, or the Employment Insurance System (Sistem Insurans Pekerjaan, or SIP), was introduced in 2018 under PERKESO. It is Malaysia's first national unemployment insurance scheme, designed to provide temporary income to workers who lose their jobs through retrenchment, company closure, or VSS/MSS schemes — as long as the job loss is not due to misconduct.
Unlike EPF savings, which you can withdraw upon retirement, EIS functions purely as insurance. You pay a small premium each month, and if you qualify, you receive monthly payments, re-employment support, and access to career counselling services.
Want to see exactly how much EIS is deducted from your salary alongside EPF, SOCSO, and PCB? Use the free salary calculator Malaysia by DuitTools — it calculates all four statutory deductions automatically.
What Is EIS and Who Is Covered?
EIS is governed by the Employment Insurance System Act 2017 (Act 800) and administered by PERKESO. Its core purpose: provide a financial safety net for workers displaced from employment.
Coverage: Who Must Contribute?
EIS is mandatory for all private-sector employees in Malaysia, including:
- Malaysian citizens aged 18 to 60 working in the private sector
- Permanent residents working in a private-sector role
- Temporary, probationary, and contract workers — as long as you receive a salary from a registered employer
Who Is Excluded?
The following categories are not covered by EIS:
- Government servants and statutory body employees
- Domestic workers (maids, gardeners, drivers employed by households)
- Self-employed individuals and gig workers without an employer
- Employees aged 57 and above who have made no prior EIS contributions (they were exempted from commencement)
- Foreign workers
- Business owners and partners
Key Principle: Employer Must Contribute Too
Like SOCSO, EIS is a shared contribution. Both employee and employer pay a small amount each month. If your employer fails to remit EIS contributions, your eligibility for benefits is affected — so it is worth checking your payslip.
EIS Contribution Rates
EIS contributions are among the simplest to calculate in the Malaysian statutory deduction system. The rate is fixed, not based on wage brackets.
2026 Contribution Formula
| Contributor | Rate | Cap |
|---|---|---|
| Employee | 0.2% of gross monthly salary | Capped at salary ceiling of RM5,000 |
| Employer | 0.2% of gross monthly salary | Capped at salary ceiling of RM5,000 |
| Combined | 0.4% of gross monthly salary |
The maximum insurable salary for EIS is RM5,000. If you earn RM5,001 or more, your EIS contribution is calculated on RM5,000 only.
Worked Examples
| Monthly Salary | Employee EIS (0.2%) | Employer EIS (0.2%) | Total Monthly |
|---|---|---|---|
| RM2,000 | RM4.00 | RM4.00 | RM8.00 |
| RM3,500 | RM7.00 | RM7.00 | RM14.00 |
| RM5,000 | RM10.00 | RM10.00 | RM20.00 |
| RM8,000 | RM10.00 (capped) | RM10.00 (capped) | RM20.00 |
| RM15,000 | RM10.00 (capped) | RM10.00 (capped) | RM20.00 |
As you can see, the maximum employee contribution is only RM10 per month — RM120 per year. The benefit-to-cost ratio is considerable.
How EIS Appears on Your Payslip
On a standard Malaysian payslip, you will typically see EIS as a line item near SOCSO:
Gross Salary: RM4,000.00
EPF (employee): -RM440.00
SOCSO (employee): -RM16.50
EIS (employee): -RM8.00
PCB (tax): -RM70.00
Net Salary: RM3,465.50
To check your exact deductions for any salary level, use the salary calculator Malaysia at DuitTools.
EIS Benefits: What You Receive If You Lose Your Job
EIS provides three categories of assistance: financial benefits, re-employment services, and career training.
1. Job Search Allowance (Elaun Mencari Pekerjaan — EMP)
This is the primary benefit. If you are retrenched and meet the eligibility criteria, you receive a monthly payment for a period depending on your contribution history.
| Contribution Period | EMP Duration | Monthly Rate |
|---|---|---|
| 12 to 23 months | 3 months | 80% → 50% → 50% of assumed monthly salary |
| 24 to 35 months | 4 months | 80% → 50% → 50% → 40% |
| 36 to 47 months | 5 months | 80% → 50% → 50% → 50% → 40% |
| 48+ months | 6 months | 80% → 50% → 50% → 50% → 40% → 40% |
The assumed monthly salary is capped at the same RM5,000 ceiling used for contributions.
Example calculation — retrenched employee with 36 months of contributions and an assumed salary of RM3,500:
| Month | Rate | Payment |
|---|---|---|
| Month 1 | 80% of RM3,500 | RM2,800 |
| Month 2 | 50% of RM3,500 | RM1,750 |
| Month 3 | 50% of RM3,500 | RM1,750 |
| Month 4 | 50% of RM3,500 | RM1,750 |
| Month 5 | 40% of RM3,500 | RM1,400 |
| Total | RM9,450 |
The first month's 80% rate is designed to cushion the immediate financial shock. Subsequent months taper down, encouraging active job-seeking.
2. Income Reduction Allowance (Elaun Pengurangan Pendapatan — EPP)
If you accept a new job that pays less than your previous salary, you may qualify for the EPP. This benefit supplements your reduced income for up to 6 months, payable at a rate of 30% of the difference between your old and new salary.
Example: Your old salary was RM3,500. Your new job pays RM2,500. The difference is RM1,000. Your EPP would be 30% × RM1,000 = RM300/month for up to 6 months.
3. Re-Employment Placement Programme
Beyond cash payments, PERKESO provides active job-matching services through the MYFutureJobs portal. Claimants must register and participate in re-employment counselling. Attendance at career coaching sessions and interviews is mandatory — failing to participate may result in suspension or termination of benefits.
4. Training Allowance and Early Re-Employment Incentive
Claimants may be approved for up-skilling or re-skilling training programmes, with potential training allowances provided. There is also an early re-employment incentive: if a claimant finds new employment before exhausting their EMP, they receive a one-off payment equal to 25% of the remaining EMP balance.
Eligibility for EIS Claims
Not every job loss qualifies. You must meet these conditions:
Qualifying Scenarios
- Retrenchment — your position is made redundant
- Company closure — the business ceases operations
- VSS / MSS — voluntary or mutual separation schemes
- Constructive dismissal — you are forced to resign due to employer breach of contract (requires PERKESO investigation)
- Natural disaster — workplace destroyed by flood, fire, or similar event
Disqualifying Scenarios
- Resignation — voluntarily leaving without employer fault
- Misconduct — dismissal for disciplinary reasons
- Contract expiry — fixed-term contract naturally ending
- Retirement — reaching mandatory retirement age
- Dismissal for poor performance not related to redundancy
Contribution History Requirement
You must have accumulated at least 12 months of EIS contributions within the 24 months immediately before job loss to qualify for the minimum 3-month EMP. Fewer than 12 months of contributions means no benefit payable.
How to File an EIS Claim
Step-by-Step Claim Process
Step 1 — Obtain documents from your employer: Your employer must issue a termination letter clearly stating the reason for job loss (retrenchment, VSS, company closure). If your employer refuses, you can still file, but PERKESO will investigate.
Step 2 — Register online via the PERKESO portal (ASSIST): Go to assist.perkeso.gov.my and submit your EIS claim online. You will need:
- Your IC number and PERKESO reference
- Termination letter from employer
- Bank account details for benefit payment
- Payslips for the last 6 months before job loss
Step 3 — Attend an interview at the nearest PERKESO office: You will be scheduled for an in-person interview. Bring original documents. A PERKESO officer will verify your claim and assess your case.
Step 4 — Register on MYFutureJobs: You must activate your profile on myfuturejobs.gov.my and begin actively applying for jobs. PERKESO monitors this.
Step 5 — Receive benefit payment: If approved, payments are credited directly to your bank account monthly. You must continue reporting your job-seeking activity each month via the portal to maintain eligibility.
Claim Timeline
You should file your claim within 60 days of your last working day. Late claims are accepted but may delay processing. PERKESO aims to process straightforward claims within 14 working days.
EIS vs SOCSO: What Is the Difference?
This is a common source of confusion. Both EIS and SOCSO are managed by PERKESO, but they serve completely different purposes:
| Aspect | EIS | SOCSO |
|---|---|---|
| What it covers | Job loss / unemployment | Workplace injury, invalidity, death |
| Benefit type | Temporary monthly payments | Medical care, pension, lump sums |
| Trigger | Retrenchment, VSS, company closure | Accident at work, occupational disease, permanent disability |
| Duration | 3 to 6 months of benefit | Can be lifelong (Invalidity Pension) |
| Contribution rate | 0.2% (employee) + 0.2% (employer) | Wage-bracket-based (varies) |
| When you can claim | After 12 months of contributions | Day 1 for employment injury; 24 months for invalidity pension |
Think of it this way: SOCSO protects you if you get hurt at work, and EIS protects you if you get removed from work.
Frequently Asked Questions
Can I withdraw my EIS contributions if I never lose my job?
No. EIS is an insurance scheme, not a savings account. Unlike EPF, there is no account balance you can withdraw. Your contributions are pooled to fund the system. If you never claim, the premiums paid benefit other insured workers — the same principle as any insurance.
I am a freelancer. Can I contribute to EIS voluntarily?
Currently, no. EIS is only available to private-sector employees with a formal employer-employee relationship. There have been discussions about extending social security coverage to gig workers through the Self-Employment Social Security Act (Act 789), but as of 2026, this only covers SOCSO for self-employed persons — EIS remains limited to traditional employees.
My employer has been deducting EIS from my salary but I suspect they are not remitting it to PERKESO. What should I do?
This is a serious issue. Your employer is legally required to remit both your employee contribution and their employer contribution to PERKESO. If they fail to do so, your claim eligibility is at risk. You can check your contribution history through the PERKESO ASSIST portal by registering with your IC number. If contributions are missing, lodge a report at the nearest PERKESO office or call the PERKESO hotline at 1-300-22-8000.
Does EIS cover part-time workers?
Yes. As long as you have a formal employment contract with a registered employer and receive a monthly salary, you are covered regardless of whether you work full-time or part-time. The contribution amounts will be lower because your salary is lower, but the same rules apply.
If I am retrenched while on probation, can I still claim EIS?
Yes, provided you have accumulated at least 12 months of EIS contributions across all employment in the preceding 24 months — not necessarily with the same employer. If you worked for a previous employer for 18 months and contributed to EIS during that time, then joined a new company and were retrenched during probation after 2 months, your total contribution period is 20 months, which qualifies you.
What happens to my EIS benefits if I find a new job before the EMP period ends?
If you secure new employment while still receiving EMP benefits, your remaining EMP amount is used to calculate your Early Re-Employment Incentive. You receive 25% of the outstanding balance as a lump sum. For example, if you have 4 months of EMP remaining with a total residual value of RM5,000, you would receive RM1,250 as a one-off payment upon confirming your new employment.
Why EIS Matters More Than You Think
Many employees treat EIS as an invisible deduction. At RM10 or less per month, it is the smallest fixed charge on most payslips. But its value proposition is arguably the strongest among statutory deductions.
Consider a worker earning RM5,000 who contributes RM10/month for five years — a total of RM600 in EIS contributions. If retrenched, that worker could receive up to RM15,300 in EMP benefits (RM4,000 + RM2,500 + RM2,500 + RM2,500 + RM2,000 + RM1,800, assuming salary cap). That is a 25x return on contributions, and it does not include the value of re-employment services, training, or early re-employment incentives.
The system is not perfect — six months of tapered benefits may not be enough to sustain someone through a prolonged job search in a tough market. But it is far better than the alternative of zero income support, which was the reality for Malaysian private-sector workers before 2018.
Know Your Deductions
EIS is one part of the broader Malaysian statutory deductions landscape. To make sure your payslip deductions are calculated correctly and to understand your full take-home pay, use the salary calculator Malaysia at DuitTools. It calculates EPF, SOCSO, EIS, and PCB using current 2026 rates, all in your browser with no data sent anywhere.
If you are planning your finances around a specific net salary target, combine it with the PCB calculator to understand your monthly tax position, and the EPF calculator to project your retirement savings.