Hire employees in

Malaysia, hassle-free

Hire employees in Malaysia, hassle-free

With Deel, your business can easily hire employees in Malaysia. No more worrying about local laws, complex tax systems, or managing international payroll. Deel takes care of everything in 150+ countries.

The average onboarding time frame in Malaysia is 5 days with Deel.

Download the Guide

Currency

Malaysian Ringgit (MYR)

Capital

Kuala Lumpur

Official Language

Malay

Payroll Cycle

Monthly

Hire employees in Malaysia. No entity needed.

Usually, to hire in Malaysia, your business needs an entity. That means a local office, an address registered as a subsidiary, and an account with a local bank. All of this, plus navigating regional benefits, payroll, tax, and HR laws, can take months.

Malaysia also treats contractors differently than full-time employees, so misclassifying a contractor could lead to fines. Deel lets you hire employees in Malaysia quickly, easily, and compliantly. We even automate tax document collection, payroll, benefits, and more.

All the necessary benefits for Malaysia
built right in

Deel allows you to provide localized benefits for employees in Malaysia within minutes. All in one manageable online dashboard.

  • Employees Provident Fund Contribution
  • Training Fund
  • Unemployment Insurance

Our quickstart guide to hiring in Malaysia

Navigate the tabs below to learn everything you need to know about hiring an employee in Malaysia

Minimum Wage Requirements

The monthly minimum wage is MYR 1,200 per month.

Individual Income Tax

The individual income tax ranges from 0% to 30%. Income tax is calculated according to progressive rates. Multiple additional factors may impact overall rates such as the household status and the number of children.

Gross Annual Income Tax Rate (%)
Up to MYR 5,000 0
Up to MYR 20,000 1%
Up to MYR 35,000 3%
Up to MYR 50,000 8%
Up to MYR 70,000 14%
Up to MYR 100,000 21%
Up to MYR 250,000 24%
Up to MYR 400,000 24.5%
Up to MYR 600,000 25%
Up to MYR 1,000,000 26%
Up to MYR 2,000,000 28%
Over 2,000,000 30%

Employer Cost

Employer cost ranges from 14% - 15% of employee salary:
  • EPF - 12-13%
  • SOCSO - 1.75-1.25%
  • EIS - 0.2-0%
  • HRDF Levy - 0.01-0%

Overtime Pay & Maximum Hours

Overtime payment is mandatory and may be included in the salary if the employee is earning less than MYR  2,000 per month. 

For employees earning over MYR 2,000 per month, overtime is not required and must be agreed upon between the employer and employee. Employees can work a maximum of 104 hours of overtime a month. For all additional hours, employees are paid 150% of their hourly rate.  Weekends employees are paid at 200% of their hourly rate and for public holidays employees are paid at 300% of their hourly rate.

Standard working hours are eight hours per day, 40 hours per week. The standard workweek is from Monday to Friday.

Maternity Leave

Pregnant employees who have worked no less than 90 calendar days in the last four months are entitled to 60 calendar days of paid leave.  Leave can be taken time up to 30 days before giving birth. The remaining days can be divided into two periods of time. The employee will receive 100% of the salary during this period, and the employer will be responsible for this pay. 

Paternity Leave

There is no paternity leave currently required by law. 

Parental Leave

In Malaysia, no law covers parental leave. However, employees may be entitled to maternity leave and paternity leave. 

Sick Leave

Employees are entitled to paid sick leave. The number of sick leave days will depend on the length of employment, which ranges from 14 to 22 days per calendar year. The employee will receive 100% of their average salary paid by the employer. 
  • Less than two years of employment - 14 days of sick leave
  • Between two and five years of employment - 18 days of sick leave
  • More than five years of employment - 22 days of sick leave
In addition to sick leave, employees are entitled to two months of hospitalization leave per year. Sick leave is paid by the employer at 100% of the salary.  A medical certificate is required under all circumstances.

Termination Requirements

Terminations in Malaysia can be complex. There is no at-will termination in Malaysia for employers and termination must be done for just cause. 

Compliant terminations include:
  • Voluntarily by the employee
  • By mutual agreement
  • By the expiration of the contract
  • Unilaterally by the employer based on:
    • Probation period
    • Objective grounds
    • Disciplinary dismissal
    • Performance due to unsuitability for the job

Notice Period

The minimum notice period is four weeks and increases based on the length of the employment. 
  • If the length of service is less than two years, four weeks
  • If the length of service is two years or more, but less than five years, six weeks notice
  • If the length of service is five years or more, eight weeks notice
For Non-Employment Act Employees, the notice period is dependent on the agreement between the employer and the employee. Employment Act Employees are generally those that earn less than RM 2,000 per month or are engaged in manual labor.

Severance for Employees

In Malaysia, all employees who are terminated and have been working for more than 12 months are entitled to severance pay, unless they were terminated for disciplinary reasons. Severance pay varies depending on the length of an employees service:  
  • 10 days of salary for service up to 2.
  • 15 days of salary for service over 2 but less than 5 years.
  • 20 days of salary for service over 5 years of service.

Paid Time Off

Both full-time and part-time employees are entitled to paid time off (PTO), the number of days based on the length of service. Employees are eligible to take PTO as soon as they accrued enough. 

Public Holidays

Malaysia celebrates both 12 national and regional holidays based on the location of the employee. 

  1. Prophet Muhammad's Birthday 
  2. Hari Merdeka 
  3. Chinese New Year
  4. Wesak Day 
  5. The Yang di-Pertuan Agong's Birthday (King's Birthday)
  6. Hari Raya Puasa 
  7. Hari Raya Qurban 
  8. Deepavali 
  9. Christmas 
  10. Labour Day 
  11. Awal Muharram 
  12. Malaysia Day

Onboarding

Onboarding takes five business days.

Employment Contract Details

Contracts must be in English. They must be in writing and signed by both parties. 
A contract must include: 
  • Position offered
  • Duration of the contract
  • Place of work
  • Basic wage & pay date
  • Working hours and days
  • Other benefits (if any)
  • Overtime (if any)
  • Annual leave
  • Termination clause
  • Sick leave and hospitalization leave
  • Rest day
  • Probationary period
  • Notice period
  • Duties and responsibilities
  • Termination clause
  • Statutory deductions and income tax

Probation Period

Employees hired using Deel have a probation period of 90 days, which you can extend up to 180 days. As of January 2022, it's Deel company policy to include probation periods in all employment contracts moving forward.

Probation periods help an employer and the employee ensure they're a hiring match, allowing a company to quickly decide if it's a fit or the employee to see if the job aligns with their career goals.
btn_download

Download the complete guide to hiring in Malaysia

Simply fill out your details below to gain access to our complete guide to hiring in Malaysia.

Hiring in Malaysia, hassle-free

With Deel, your business can easily hire employees in Malaysia. No more worrying about local laws, complex tax systems, or managing
international payroll. Deel takes care of everything in 150+ countries.

Group (8)

599 USD

Management fee

Group (9)

14-15%

Estimate Employer Cost

*of employee salary

Want to learn the cost of hiring an employee in Malaysia?

View our Employee Cost Calculator

We have a 4.9 out of 5 rating on Trustpilot

We're trusted by over 6,000 businesses all over the world. Read our reviews on Trustpilot.com.

5 Stars

Deel is the best!!

“Deel is an amazing platform! It's super intuitive and user friendly, plus it runs suuuuper smoothly!! It has great options for paying and withdrawing money, plus it helps you keep super organized with your spending. They also have great support and are super friendly with all the questions you might have :D I would definitely recommend it!!”

Manuela Echeverry
Nov 20, 2020
5 Stars

A contracting life-changer!

"This has by far the singular tool that made my contracting work amazing. It used to be that contract management and payouts was a nightmare — Deel makes everything so easy especially with its Transferwise integration. Everyone gets paid on time and kept happy. I also contacted their support a couple of times for some small questions and they’ve been nothing short of amazing. If you’re a contractor or someone who hires contractors then definitely give Deel a go."

Kix Panganiban
Dec 3, 2020
5 Stars

Great service offering!!

"The Deel platform has been super effective for my team and I and has enabled us to bring on workers globally. The platform allows us to onboard individuals seamlessly and with no issues at all. Highly recommend."

Michael US
Oct 28, 2020
5 Stars

Terrific service

"Great service, amazing customer care, terrific platform, both for the company and for the contractors/employees. Saving everyone's time and money"

Nunzio Martinello
Dec 15, 2020
5 Stars

Deel is a game-changer for distributed teams

"Deel has been instrumental in helping us both open and operate our EU operations. It's super simple to set up and implement and the support team has been world-class. I can't recommend them enough!"

Jeremie Habib
Nov 16, 2020
5 Stars

Great app with great customer service

"Great app with great customer service, with great attention to details and legal requirements. Looking forward to keep using it!"

Felipe Marote
Jan 29, 2021

Deel makes growing remote and international teams effortless. Ready to get started?

+

Countries

+

Customers

+

Legal experts

+

Currencies