THE SOCIAL SECURITY ORGANISATION OF MALAYSIA (SOCSO)

OVERVIEW LEGISLATION & ADMINISTRATION COVERAGE & BENEFITS INTRODUCTION LEGISLATION & ADMINISTRATION COVERAGE & BENEFITS FINANCIAL MANAGEMENT COOPERATION WITH ILO POLICY RESPOND CHALLENGES PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION )

DEFINITION OF SOCIAL SECURITY “The protection which society provides for its members, through a series of public measures, against the economic and social distress that otherwise would be caused by the stoppage or substantial reduction of earnings resulting from sickness, maternity, employment injury, unemployment, invalidity, old age and death; the provision of medical care; and the provision of subsidies for families with children”. - ILO PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION )

INTRODUCTION Unemployment Employment Injury 9. 1. Family Old-age 8. 2. Disability Social Security Benefits 7. Employment Injury 3. Death 6. Medical Care 4. Sickness 5. Maternity PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION )

INTRODUCTION SOCIAL SECURITY IN MALAYSIA Welfare Department Labor Department Welfare Department - Universal - Means-tested Employment Act Social Insurance Work related Injury/ diseases Employee Provident Fund JPA (Public Services Department (Public Sector Pension Scheme) SOCIAL SECURITY IN MALAYSIA PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION )

LEGISLATION & ADMINISTRATION PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION ) LEGISLATION & ADMINISTRATION ORGANIZATIONS RESPONSIBLE Cooperation between Employers, Employees and Government SOCSO Malaysia was set up in 1971 To implement, administer and enforce The Employees' Social Security Act, 1969 and the Employees' Social Security (General Regulations) ,1971. SOCSO has 46 branches in throughout Malaysia

VISION To become the leading Social Security Organization in the World PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION ) VISION To become the leading Social Security Organization in the World

MISSION SOCSO is committed to provide social security for all Malaysian workers and their dependents through the principles of social insurance through: Prompt, efficient and quality service; Periodical review of the benefits system; Prudent financial and investment management; and Promoting OSH PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION )

SOCSO'S STRATEGIES SOCSO is committed to provide social security for all Malaysian workers and their dependents through the principles of social insurance through; Giving highest priority to the interest of the nation and the organization. Providing prompt, efficient, quality, fair, precise, speedy and economical services to the clients. Improving the skills and expertise of the SOCSO personnel besides utilising advanced technology to upgrade client services. Periodical review of the benefits system Maintaining and strengthening the viability of the SOCSO Fund Prudent financial and investment management. Fostering goodwill and noble values amongst SOCSO's personnel. Co-operating with all the parties involved in the provision of social security protection. PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION )

COVERAGE Employers Liability Employee Exemption: PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION ) COVERAGE Employers Liability Who employs one or more employees – required to register & contribute monthly for all employees All employee irrespective of the employment status, permanent, temporary etc Must register irrespective of age; Age 55 and above will continue to be protected (EIS-e’yer) Employee Earns a monthly wage RM3,000 or less More than RM3,000: Previously registered, must compulsorily continue Not previously registered, can opt to do so. Exemption: Government employees Domestic servants Self employed persons Foreign workers

COVERAGE EMPLOYMENT INJURY SCHEME (EIS) Protection for accidents: PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION ) COVERAGE EMPLOYMENT INJURY SCHEME (EIS) Protection for accidents: While traveling Arising out and in the course of employment Occupational disease INVALIDITY PENSION SCHEME (IPS) Serious disablement or morbid condition of a permanent nature that is either incurable Unable to earn at least 1/3 of normal person 24 hours coverage Against invalidity or death due to any cause not connected with his employment

COVERAGE ACTIVE EMPLOYERS ACTIVE EMPLOYEES PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION ) COVERAGE ACTIVE EMPLOYERS ACTIVE EMPLOYEES

BENEFITS Medical benefit Temporary disablement benefit PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION ) BENEFITS Employment Injury Schemes Medical benefit Temporary disablement benefit Permanent disablement benefit Constant attendance allowance Dependant’s benefit Funeral benefit Rehabilitation benefit Invalidity Pension Schemes Invalidity pension Invalidity grant Constant attendance allowance Survivors pension Funeral benefits Rehabilitation Educational loan

BENEFITS Employment Injury Schemes Medical benefits PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION ) BENEFITS Employment Injury Schemes Medical benefits Occupational disease Treatment at SOCSO panel clinic @ government Hospital/clinic Free – socso Serious injury – to nearest government hospital 2nd class ward-inpatient Temporary disablement benefit Unfit for work not less than 4 days Only during medical leave Daily rate = 80% of daily wage or min RM10 and max RM78

BENEFITS Employment Injury Schemes Permanent disablement benefit PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION ) BENEFITS Employment Injury Schemes Permanent disablement benefit Cash – certified of permanent disablement Loss 100% = 90% daily @ min RM10 Loss 20% or less = lump sum payment Exceed 20% = 1/5 daily rate into lump sum and balance = monthly pension Can continue work Constant attendance allowance Permanent total disablement (100% loss) Severely incapacitated & requires personal attendance of another person 40% of rate total disablement, max RM500 Dependant’s benefit If employees dies 90% of the daily wage

BENEFITS Funeral benefit Rehabilitation benefit RM1,500 PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION ) BENEFITS Employment Injury Schemes Funeral benefit RM1,500 As resulted of EI or while receiving disablement benefits Next of kin @ person WIL Rehabilitation benefit Facilities for vocational & physical rehabilitation training

BENEFITS Qualifying condition Has not completed age 55 PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION ) BENEFITS Qualifying condition Has not completed age 55 Certified by medical board Fulfilled the qualifying condition contribution Invalidity Pension Schemes Full qualifying condition At least 24 months within 40 consecutive months 2/3 = at least 24 50% - 65% of monthly salary Reduced qualifying condition 1/3 = at least 24 50% Minimum RM250

BENEFITS Invalidity grant Constant attendance allowance PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION ) BENEFITS Invalidity Pension Schemes Invalidity grant Paid for those who are not qualified for Invalidity pension At least 12 months amount of the total contributions Outright payment Constant attendance allowance Recipient of invalidity pension 40% of the rate invalidity pension Max RM500 per month

BENEFITS Survivor’s pension Funeral benefits PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION ) BENEFITS Invalidity Pension Schemes Survivor’s pension Only if employee dies irrespective of the cause of death While receiving invalidity pension Not more than 55 years Rate: Invalidity pension = equal If not = 50% - 65% Funeral benefits While receiving invalidity pension Before 55 age As EIS

PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION ) COOPERATION WITH ILO Since 1971, SOCSO has formed a strategic cooperation with ILO in the form of technical and legal advice that covered a broad range of policy and strategic issues, including social security, occupational safety and health, gender equality in employment, and other aspects of labour standards. Recently, SOCSO and ILO began the Relief fund project and study on unemployment insurance . The ILO also supports actuarial work with SOCSO for every five years and this is a ninth actuarial study.

FINANCIAL MANAGEMENT Year Total Fund Income Contribution PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION ) FINANCIAL MANAGEMENT Year 2007 2008 2009 2010 Total Fund 15517.8 16359.7 17702.6 18625.2 Income   Contribution 1689.5 1834.7 1868.8 2007.8 Investment Return 884.9 391.6 1015.2 870.8 Others 32.1 4.3 17 28.5 Total 2606.5 2230.5 2900.9 2907.1 Expenditure Liabilities 1070.2 1198.9 1366.9 1699.7 Operating 165.4 189.7 191.2 238.8 1235.1 1388.6 1558.1 1938.5 Excess 1370.9 841.9 1342.9 968.6

FINANCIAL MANAGEMENT PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION ) FINANCIAL MANAGEMENT

FINANCIAL MANAGEMENT STATISTICS TOTAL RECIPIENT 2010- 351,433 PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION ) FINANCIAL MANAGEMENT STATISTICS TOTAL RECIPIENT 2010- 351,433

FINANCIAL MANAGEMENT STATISTICS PAYMENT OF BENEFIT 2009-1,354,128 PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION ) FINANCIAL MANAGEMENT STATISTICS PAYMENT OF BENEFIT 2009-1,354,128 2010-1,678,160

PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION ) STRATEGIES New approach of Social Security Compensation Oriented (Pay workers to stay off work) defined as total replacement of income with dynamic Social Security through Disability management (Pay workers to return to work). The introduction of this comprehensive approach was in response to the need to cover a more diverse employee base.

CHALLENGES Increasing cost Investment issues PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION ) CHALLENGES Increasing cost Investment issues Efficiency in processing claims Pressures from mass media Pressures from NGOs Migrant workers Fraudulent claims

PROMOTION OF SAFETY AND HEALTH PERTUBUHAN KESELAMATAN SOSIAL / (SOCIAL SECURITY ORGANISATION ) PROMOTION OF SAFETY AND HEALTH To play a complementary role in the promotion of OSH in Malaysia To reduce occupational injuries and diseases through Primary, Secondary and Tertiary Prevention To educate both employers, employees and public on safe and healthy workplace. To co-operate with other bodies responsible for promoting or policing O.S.H (like NIOSH, DOSH,NGO’S) to bring awareness of the importance of safety and health To gather and provide OSH data on Occupational injuries and diseases for academic studies.

THANK YOU

PERTUBUHAN KESELAMATAN SOSIAL (PERKESO)/ SOCIAL SECURITY ORGANISATION (SOCSO) MENARA PERKESO 281 Jalan Ampang 50538 Kuala Lumpur, MALAYSIA Website : www.perkeso.gov.my