By Natasha Busst and Lauren Lopez
Norma Mansor of Universiti Malaya says the government would need to ensure the contribution system is fair and does not place an excessive burden on employees, particularly those with limited incomes. (Bernama pic)
PETALING JAYA: While Malaysia’s social security system is designed to support workers injured during the course of their duties, protection becomes far less certain when accidents occur outside official working hours.
The limitation is not new but has become more apparent as work patterns shift and more Malaysians take on roles that do not always fit conventional schedules.
This was evident in 2023, when a total of 82,876 accidents were reported to the Social Security Organisation (Perkeso). Of these, only 68,220 were recognised as work-related incidents.
This means 14,656, or 17.68% of all workers, were left without coverage – a number that could be even higher. given the exclusion of the large informal sector which does not actively contribute to Perkeso’s Employment Injury Scheme.
Norma Mansor.
Norma Mansor, director of Universiti Malaya’s social wellbeing research centre, said while the current system is relatively robust for formal employees, it fails to take into account the shifting realities of modern employment.
She said the most notable gaps in injury coverage are in the informal sector as well as among formal sector workers without formal contracts, who are often excluded from mandatory protection schemes.
The shortcomings of the current system do not end at coverage, with those entitled to support often facing significant hurdles in making claims.
Jose Rizal.
Gabungan E-hailing Malaysia (GEM) chief activist Jose Rizal criticised the bureaucracy involved in filing Perkeso claims, calling it unnecessarily difficult, particularly for those recovering from trauma.
“The people filing claims are usually the ones who have just been through an accident and are suffering from trauma. It can be difficult for them to file a claim with Perkeso,” he told FMT.
Filling the gaps
In response to growing concerns, the government has proposed Skim Kemalangan Bukan Bencana Kerja (SKBBK), or the Non-Occupational Accident Scheme: a no-fault accident scheme intended to extend protection beyond traditional work settings.
SKBBK is designed to provide coverage regardless of when or where an injury occurs, making it particularly relevant for workers under flexible arrangements, hybrid roles or mobile employment contracts.
Norma views the proposal as a positive step toward a more inclusive system, shifting the focus from assigning fault to ensuring people receive the support they need.
“It makes claims simpler and faster. It also removes the burden on individuals and their families to prove fault during an already difficult time. That, to me, is the key advantage of having a scheme like this,” she said.
Norma highlighted other potential benefits of the scheme, including improved social equity, reduced risk of falling into poverty after injury, lessened burden on the healthcare system and stronger labour market security.
“People need confidence that they have something to fall back on when taking risks, especially the risks that come with innovation. To support that kind of risk-taking, we need stronger social protection,” she said.
Although the scheme received approval in principle in 2024, it still awaits parliamentary approval – a delay that leaves many vulnerable workers in limbo.
No further delay
Jose welcomed the proposed scheme, noting its potential to close longstanding gaps in social security coverage for Malaysians in evolving forms of employment.
However, he emphasised that to fully protect gig workers, the government would need to eventually expand the scheme to cover the self-employed, and in the interim ensure clear timelines and frameworks for that inclusion.
“Unlike office workers with fixed locations, (e-hailing drivers’) workplaces vary daily. This makes it difficult to prove whether an incident occurred while working or commuting home.”
Challenges and setbacks
When asked about potential drawbacks to the scheme, Norma argued that concerns over possible misuse, such as fraudulent claims, should not stall meaningful reforms.
She said the government would need to ensure the contribution system is fair and does not place an excessive burden on employees, particularly those with limited incomes.
“This scheme needs to consider how it can be truly inclusive, especially for the lowest earners. The sooner we do this, the sooner we can build the reserves needed to support a broader range of social security claims.”
The scheme’s introduction could also have ripple effects on how personal injury cases are handled – potentially reshaping the role of legal representation in accident claims.
Tunku Farik Ismail.
Lawyer Tunku Farik Ismail said that while SKBBK may reduce reliance on legal action, it is unlikely to eliminate the role of personal injury lawyers altogether.
He said a dual system would likely remain, as some individuals may choose to hold private insurance in addition to Perkeso coverage.
“Perkeso has limits as to how much they can pay out. It’s fixed by statute, whereas private insurance for personal accidents depends on how deep your pockets are. You can buy more coverage if you pay more,” he told FMT.
Meanwhile, Norma said Perkeso’s expansion could be an opportunity for collaboration between the private sector and government, saying that competition should drive improvement.
“We should work together, rather than have one trying to ‘kill’ the other. We compete, we become better and we work together,” she said.
The way forward
Tunku Farik said while the scheme was a step in the right direction, a broader mindset shift was needed, not only among policymakers, but also among employers and the public.
“When it comes to insurance, it’s not just about saving money on premiums. It’s about thinking of the people who might be affected if something goes wrong.
“The same applies in the workplace. If an employee gets injured, have you made the contributions? Will they be covered?” he said.
Norma argued that as Malaysia moves closer to a high-income nation status, it must embrace social protection as a fundamental part of doing business.
“We need to think more as a nation guided by solidarity with employers recognising this as a part of the cost of doing business.”
“If workers are not covered, any major crisis could pose a significant challenge for Malaysia. Expanding social security coverage to include everyone is the way forward,” she said.