You've built enough revenue that one person can no longer do the work yourself. You're ready to hire in Malaysia. What you're not ready for is the administrative layer that sits between the offer letter and the first paycheck. Employment law in Malaysia is employer-protective on paper but operationally detailed. You need to understand EPF contributions, SOCSO insurance, EIS levies, statutory leave entitlements, and contract requirements before you onboard. Miss a deadline or a contribution and you're exposed to fines, back-pay claims, and penalties that cost far more than the hire itself. This guide walks you through the actual sequence: what you must file, when, which rates apply in 2025, and how to set up payroll so you don't scramble every month. The Malaysian employment law timeline: what you need before day one Employment begins the moment the person starts work. That start date triggers your statutory obligations. You don't have a grace period. Before the first day: Employment contract. Written, in English or Bahasa Malaysia (or both). Must specify job title, salary, benefits, notice period, and termination terms. No verbal agreements hold in a dispute. EPF registration. Register the employee with the Employees Provident Fund within 15 days of employment. You can file online via the EPF portal. This is not optional—failure to register incurs penalties. SOCSO registration. Register for Social Security Organisation coverage (mandatory for all employees earning under RM5,000/month). File within 15 days of employment start. Inland Revenue Board (IRB) notification. Notify the tax authority of the new employee for payroll tax purposes. This is typically embedded in your payroll system if you use accounting software, but verify it's filed. Payroll system setup. Configure your payroll software to calculate EPF, SOCSO, EIS, and income tax correctly. If you're using a spreadsheet, you're building technical debt; accounting and HR software (including Orin's HR module ) automate these deductions and generate the required statutory reports. The 15-day window is tight. Start the registration process in parallel with the offer stage. EPF: mandatory pension contributions and the match math The Employees Provident Fund is a mandatory retirement savings scheme. Both employer and employee contribute a percentage of the employee's gross salary. Current rates (as of 2025; verify with EPF directly): Employee contribution: 11% of gross salary (capped at a maximum contribution, currently around RM6,050/month for higher earners). Employer contribution: 13% of gross salary (same cap applies). If your first hire earns RM4,000/month: Employee deduction: RM440 Employer cost: RM520 Total monthly funding into EPF: RM960 The employee's RM440 is deducted from their net pay (they see it on the payslip). Your RM520 is a separate employer cost you must budget for. Many founders forget to include this in their hiring cost model. Key point: EPF is not optional. There is no threshold below which you can skip it. Even a part-time or contract worker earning RM100/month must be enrolled if the employment relationship meets EPF criteria. SOCSO, EIS, and your insurance obligations Beyond EPF, two more statutory contributions apply to most employees. SOCSO (Social Security Organisation) Provides disability and death benefits. Contributions are employer-paid only; the employee does not see a deduction. Current rates (2025; verify with SOCSO): Employee earning RM4,000/month: approximately RM67–80/month (employer pays). Rate varies by payroll band (SOCSO uses brackets). SOCSO is mandatory for all employees earning below RM5,000/month. Above that cap, it's optional (some employers still enroll higher earners for coverage). Who files: The employer (you). Register within 15 days of hire via the SOCSO online portal. EIS (Employment Insurance System) Provides income protection if the employee is laid off. Both employer and employee contribute. Current rates (2025; not all employers are required to participate—check with the Ministry of Human Resources): Employee contribution: typically 0.3–0.5% of gross salary. Employer contribution: typically 0.3–0.5% of gross salary. EIS participation is mandatory for employers with a total monthly payroll exceeding a certain threshold (currently around RM10,000, but this varies by state and regulation). Verify with the Ministry whether your hire triggers EIS registration. Why this matters: If you hire your first employee and later hire a second, your combined payroll may suddenly exceed the EIS threshold. You'll need to register both employees retroactively, which means back-filing contributions and penalties for late enrollment. Plan ahead. The employment contract: what must be in writing An employment contract must exist in writing. Verbal offers are not enforceable under Malaysian law and expose you to disputes over terms. The contract must include: Job title and responsibilities. Clear, specific, and honest. If t