Photo: Bernama
KUALA LUMPUR: Gig workers must be supported with a social security net that also allows them to upskill without having to lose their earnings, says Datuk Seri Ahmad Zahid Hamidi.
The Deputy Prime Minister said that with only 222,876 gig workers of the 1.1 million individuals currently making contributions to the Social Security Organisation (Socso), it is pertinent for the Gig Workers’ Economy Act to come into place as soon as possible.
He said this while officiating the International Social Security Association (ISSA) Technical Seminar at the World Trade Centre here Tuesday (Aug 27).
Ahmad Zahid, who is also the chair of the Supreme Committee on the Establishment of the Malaysian Gig Economy Commission, called on the establishment of the Malaysian Gig Economy Commission (SEGiM) to ensure all gig workers are protected.
He said that to address these issues, Malaysia is committed to enhancing the welfare and well-being of gig workers through a comprehensive strategy.
“One key initiative is the establishment of SEGiM to regulate the gig economy in Malaysia,” he said.
He said the Gig Economy Worker’s Act will prove to be a groundbreaking move that positions Malaysia as one of the earliest countries in the world to introduce an employment act specifically for gig economy workers.
“This new act, led by the Human Resources Ministry, is expected to be tabled before the Cabinet within the next two months, underscoring Malaysia’s commitment to protecting gig workers' rights by focusing on social protection, contract disputes, and career advancement.
“Recent data as of August reveals that 25.1% of Malaysia’s workforce (3.15 million out of 12.56 million) is self-employed, including 1.5 million freelancers. We have made remarkable progress since 2017. From the humble beginnings of our first self-employed registration on June 2 2017, I am immensely proud to announce that Socso has now recorded 679,830 self-employed individuals.
“Yet, as we celebrate this achievement, we must also recognise that there is still much work to be done since only 21.58% of self-employed individuals have active Socso coverage, with 32.78 %(222,876) being gig workers.
“These figures underscore the significant gap in social protection for a substantial portion of our workforce, highlighting the urgent need for expanded coverage and tailored solutions for the gig economy,” said Ahmad Zahid.
He pointed out that the gig economy can be a “double-edged sword” which offers unprecedented flexibility and opportunities for workers and businesses alike, while simultaneously posing formidable challenges in areas such as worker protections, job security, and regulatory frameworks.
“Yet it also exposes gaps in our traditional labour market and social security frameworks. Addressing these gaps with urgency and innovation is imperative,” said Ahmad Zahid.
He pointed out that the Covid-19 pandemic proved how the gig workers kept the economy alive while the society had to practise social distancing and depended on them.
“The Covid-19 pandemic accelerated this shift, with many entering the gig economy out of necessity or choice.
“Recognising this, Malaysia had introduced a contribution matching grant to protect these workers, administered by Socso. Under the Madani Budget 2024, the government continued this effort by allocating RM100mil to support the self-employment sector, aiming to protect around 500,000 self-employed individuals.
“Under this initiative, workers in the informal sector now pay only 10% of their contributions for 12 months of coverage. This programme has been further bolstered by the enforcement of mandatory contributions under Act 789, strategically targeting crucial sectors such as passenger transportation and goods and food transportation.
“The inclusion of 18 additional viable sectors underscores our comprehensive approach to expanding social security coverage across diverse employment landscapes,” said Ahmad Zahid.
