Employment Insurance System Amendments: Higher Job-Loss Benefits Now, Vacancy Fines From 2027
In brief: Most amendments to Malaysia's Employment Insurance System Act 2017 came into force on 1 October 2026. Workers who lose their jobs can now receive higher re-employment and training benefits from PERKESO, plus a new RM1,000 mobility allowance. A new duty on employers to tell PERKESO about job vacancies, backed by tiered fines, applies from 2 January 2027.
This article is general information about Malaysian employment law for the public.
What is the Employment Insurance System?
The Employment Insurance System, known as EIS or SIP, is run by PERKESO (the Social Security Organisation) under Act 800, which the amendments renamed the Employment Insurance System and Employment Services Act 2017. PERKESO now promotes the scheme as LINDUNG Kerjaya. Contributors who lose their jobs and meet the eligibility conditions may receive a Job Search Allowance, training support and help finding new work.
What has changed?
The Employment Insurance System (Amendment) Act 2026 (Act A1796) received Royal Assent on 30 August 2026 and was gazetted on 15 September 2026. Under the commencement notice, everything except the new employment services provisions came into force on 1 October 2026. According to PERKESO, the main benefit changes are:
the Early Re-Employment Allowance, paid to people who find a new job quickly, rises from 25% to 50% of their remaining Job Search Allowance;
the maximum training fee covered rises from RM4,000 to RM7,000;
the Training Allowance rises to RM30 a day; and
a new one-off RM1,000 Mobility Assistance Allowance is paid to a contributor who received EIS benefits after losing their job and then takes up a new job more than 100 kilometres from home.
PERKESO estimates that more than seven million contributors stand to benefit, with an average of about RM3,300 per person. Claims can be made online through the LINDUNG Kerjaya portal or at any PERKESO counter.
What does it mean for employers?
The amendments add a new section 45F, under which employers must notify PERKESO in writing of job vacancies and new positions before hiring, and tell PERKESO within seven days once a post is filled. This part of the Act comes into force on 2 January 2027. The Bill originally proposed a maximum fine of RM10,000. After concerns from small businesses, the Dewan Negara amended it on 12 March 2026, and the Dewan Rakyat agreed on 30 June 2026, to a tiered structure: a fine of up to RM1,000 for a first offence, RM3,000 for a second offence and RM5,000 for a third or later offence.
The Deputy Human Resources Minister told Parliament that employers would first be issued compliance notices, so they can put things right before any compound is imposed. Even so, businesses that recruit regularly should set up a reliable way of reporting every vacancy.
Why does it matter?
For workers, the changes make a period of unemployment a little less precarious and reward finding work quickly, even if that means moving to another part of the country. The higher training limits also make it easier to retrain for a new field.
For employers, from 2 January 2027 vacancy reporting is no longer just good practice: failing to notify carries a defined penalty. The Government's stated aim is better labour market data, so that PERKESO can match job-seekers with suitable jobs more quickly.
What happens next?
The Act also applies the amended claim rules to claims still pending on 1 October 2026. PERKESO has said it will continue to strengthen its MYFutureJobs portal and career services to help contributors return to work.
Frequently asked questions
How much is the PERKESO Mobility Assistance Allowance?
It is a one-off payment of RM1,000. It is for a contributor who lost their job, received EIS benefits and then secured new employment more than 100 kilometres from home, subject to PERKESO's eligibility conditions.
Do employers have to report job vacancies to PERKESO?
Yes, from 2 January 2027. New section 45F of the Employment Insurance System and Employment Services Act 2017 requires employers to notify PERKESO in writing of vacancies before hiring. Failing to do so can lead to a fine of up to RM1,000, RM3,000 or RM5,000, depending on whether it is a first, second or repeat offence.
When did the new EIS benefit rates start?
The new rates apply from 1 October 2026, when most of the amending Act came into force. PERKESO says contributors who lose their jobs from that date and meet the conditions can claim at the new rates.
Sources and further reading
Last updated: 21 October 2026.
This article is published by Khaw Ewe Seng & Co., Advocates & Solicitors (Penang) for general information about Malaysian law. It is not legal advice, and it does not create a solicitor–client relationship. For advice on a specific matter, please consult a qualified lawyer.
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