KUALA LUMPUR: The mandatory Employees Provident Fund (EPF) contribution for foreign workers is expected to take effect in the fourth quarter of this year, says Finance Minister II Datuk Seri Amir Hamzah Azizan (pic).
This follows the passing of the Employees Provident Fund (Amendment) Bill 2025 in the Dewan Rakyat, which mandate foreign workers and their employers to contribute 2% of monthly wages to the retirement fund.
Amir Hamzah said foreign workers will be allowed to withdraw their EPF contributions when they return to their home country, rather than waiting until they turn 55.
“This is as long as their work permits have expired and there is proof their permanent employment has ended,” he said during his winding-up speech on the debates on the EPF Act.
He added that the EPF is currently developing a registration mechanism for foreign workers by integrating its database with federal agencies, such as the Immigration Department.
This, he said, will enable automatic registration of workers and allow banks to verify information related to accounts held by non-citizens.
The EPF will also expand its online registration channels through i-Akaun (Employer) and self-service terminals.
Amir Hamzah noted that making EPF contributions mandatory for foreign workers will help bridge the gap between local and foreign employees while ensuring all workers are covered under a social protection scheme.
As of December 2024, only 22,635 foreign workers – or 0.9% of the 2.5 million working in Malaysia – have opted to actively contribute to the EPF, he said.
He said foreign workers who are already contributing can request to keep their current contribution rate. The rate has been set at 2% for both employers and employees, with potential adjustments in the future.
Amir Hamzah said this rate is designed to keep employer cost increases manageable and structured, reducing the risk of economic shocks. The Bill was tabled for its first reading on March 4.
