Starting 1 October 2025, all foreign workers in Malaysia (except domestic workers) will be automatically enrolled in EPF.

Employer pays 2%.
Employee pays 2%.

On paper, it looks minor.

But let’s be real! 2% won’t make foreign workers rich, and it won’t bankrupt employers.

Yet in today’s climate of tariff trade wars, SST 2.0, surprise stamp duty enforcement, and the looming e-invoicing deadline… even small costs can feel like the last straw for businesses already stretched thin.

Yes. But if you’re running a business, especially in sectors like manufacturing, construction, F&B or plantation — you’ll know 2% times 500 workers is not small anymore.

Here’s the full picture.

Previously, EPF for foreign workers was voluntary.

Very few signed up.

Now, it’s compulsory for all non-Malaysian employees with valid work permits.

Employers must:
• Register foreign workers with EPF
• Deduct 2% from wages + contribute 2% as employer
• Pay by the 15th of each month

Payroll & HR teams … another task added to your already packed to-do list.

Why 2% Only?

At first, the proposal was to match Malaysian EPF rates (up to 12%).
But industry players pushed back hard.

The reason?

✅Rising costs of doing business
✅Inflation and global supply chain pressure
✅Malaysia’s heavy reliance on foreign labour

So, the government settled for 2% … a compromise to balance:

✅ Basic protection for workers
✅ Competitiveness for employers

What should you do before 1 August?
✅ Register with EPF if you haven’t
✅ Register all eligible foreign staff
✅ Update payroll system (round to nearest RM)
✅ Brief your staff — especially your foreign workers
✅ Follow EPF’s upcoming guidelines closely

Malaysia Boleh!