The Employees Provident Fund (EPF) announced that all employers and foreign workers will be required to contribute two percent (2%) of their monthly salary to the EPF, effective October 2025.
According to a report by The Edge, the new regulation applies to all non-citizen workers who have a valid passport and work pass issued by the Immigration Department, except for domestic workers.
Prime Minister Datuk Seri Anwar Ibrahim previously announced that the 2% contribution rate was much lower than the original proposal of 12%. He said that the decision was made after the government took into account the views and feedback from various chambers of commerce and industry.
Anwar also explained that this initiative is part of the implementation of Budget 2025, where the government stated its intention to make EPF contributions mandatory for all foreign workers, and it will be implemented in phases.
The EPF expects this move to benefit over two million foreign workers in the country, with the implementation mechanism currently being finalised.
Prior to the implementation of this new policy, EPF contributions for foreign workers were voluntary, at a rate of 11% for those under 60 years of age, and 5.5% for those 60 years of age and above. Employers were only required to contribute RM5 under the scheme.
With this change, the government is seen taking a step forward in ensuring that the long-term financial welfare of foreign workers is also given attention, in line with the principle of inclusiveness in the country's social protection policy.
