LETTER | Social Security Organisation (Socso) wishes to thank Chan Yet Sang for his comments in the letter “Unfair to impose Socso on self-employed taxi drivers”.
The Self-Employed Employment Injury Scheme, which took effect on 1 June 2017, provides protection to self-employed insured persons and their dependents from employment injuries including occupational diseases and accidents during work-related activities.
This social protection is in accordance with the provisions of the Self-Employment Social Security Act 2017 (Act 789).
Act 789 was created after a detailed study undertaken by the Government to balance the social security needs of workers throughout the country, in line with the Article 23 of The Universal Declaration of Human Rights (1948), The ILO Convention C102 Social Security (Minimum Standards) 1952 and the R202 Social Security Protection Floor Recommendation 2012.
This law was introduced because of the Government’s concern for the welfare of all workers in Malaysia including the self-employed. We have witnessed many self-employed citizens, including taxi drivers, who received no compensation when they met with accidents, leaving their families with no breadwinners.
Initially, Act 789 provides protection under the Self-Employed Employment Injury Scheme to self-employed taxi drivers and individuals providing similar services including e-hailing drivers such as GrabCar.
Effective Feb 1, 2019, the coverage under this Act was extended to self-employed bus drivers such as those who drive stage buses, charter buses, express buses, mini buses, employees’ buses, feeder buses, school buses and airport buses.
Socso is offering flexibility in payment of contribution and the drivers can choose from a sum as low as RM13.10 a month for a total of RM157.20 a year, based on a monthly income of RM1,050.
The Human Resources Ministry, through Socso, has established the best protection scheme with the lowest rate of contribution compared to other insurance options.
With a minimum payment of RM13.10 a month, contributors and their family members would receive a monthly pension of RM945 in the event of an accident. To date, there are over 108 claims under the scheme with compensation amounting more than RM237,000.
Socso is expanding the coverage under Act 789 to the self-employed in all economic sectors in Malaysia including those in the informal sectors such as farmers, fishermen and arts activists, based on directive from the Government.
According to the Department of Statistics Malaysia, as of the third quarter 2018, about 20 percent of the 14 million employees in Malaysia are self-employed, and most are not covered by any formal social protection.
The concept of Socso’s Social Security Protection is based on joint responsibility through the pooling of resources and sharing of risks.
It means contributions made by Socso’s contributors are channeled to a solidarity fund. Under this concept, all contributors willingly allow Socso to use contributions from the solidarity fund to pay benefits to insured employees who suffer from disability or invalidity, or survivors’ pension for their dependents in the event of death.
This statement was issued on behalf of Socso by the Human Resources Ministry.
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