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What are the Different Benefits if You Lost your Job? What is the difference between ERP, Wage Subsidy and EIS(JSA)?

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Bryan Ng is a Partner of a law firm and founder of Legal Warrior. With the years of hands-on experience in Court and Corporate practice, Bryan Ng has developed a deep passion for helping businesses to be successful. He advises a broad spectrum of law relating to Companies, including Company Law, Employment, and Intellectual Property Law.

Author profile

Graduated LLM Legal Practice (Barristers) at BPP Birmingham with Distinction and was called to the Bar of England & Wales on November 2019. She was awarded the highest mark in Malaysia in Equity & Trusts during LLB. She is a jelly artist that loves reading and she travels to recharge her soul.

In the latest Economic Stimulus Package announced by the Prime Minister following the extension of the Movement Control Order (MCO), the Government had allowed for the employers to apply for the Wage Subsidy Programme. However, this is not to be confused with the Employment Retention Programme that has been in force since March 2020.

Employment Retention Programme (ERP)

Under this programme, the employees will be receiving a monthly payment of RM600 where they have agreed to undertake unpaid leave with their employers. The requirements to be eligible for this programme is as follow:

  • The employee has registered and contributed to the Employment Insurance System (EIS);
  • The employee is paid a monthly salary of RM4000 and below;
  • The implementation of the unpaid leave notice with the consent of both parties:
  • Commenced on 1March 2020;
  • Is valid for a minimum of 30 days; and
  • Between 1 to 6 months.

Application under this programme must be made by the employer and can be made starting from 20 March 2020 by submitting the completed Form [Borang Permohonan ERPC-19] to erpc19@perkeso.gov.my . PERKESO will then channel payment to the employer who will in turn pay their employees within 7 days after the payment being received. The total amount that will be received by an employee under this programme will be RM600 only.

Wage Subsidy Programme

This programme is introduced by the government as an effort to assist the employers affected by Covid-19 to ensure that they can continue operating and to avoid the employees working there from losing their employment.

The following are the schemes announced on 6 April 2020:

Size of CorporationMicro & SmallMediumLarge  
No. of Employees  75 and below76 tp 200More than 200
Amount Subsidised (per month, per employee)RM 1,200RM 800RM 600
Limited to (no. of employees)75200200

In order for the employers to be eligible, the below requirements must be fulfilled:

  • The employer’s revenue has declined by 50% by comparing the sales volume on January 2020 with the following months (not required for employers of micro and small corporations);
  • Employers and employees must be registered with or have contributed to PERKESO;
  • Employers must be registered with Suruhanjaya Syarikat Malaysia (SSM) or Pihak Berkuasa Tempatan (PBT) before 1 January 2020;
  • Employers must have started operating before 1 January 2020;
  • Limited to employees that receive monthly salary of RM4000 and below only;
  • The employer must not remove his/her employee within 6 months of the implementation of the programme (3 months while receiving the subsidy and 3 months thereafter); and
  • The employer is not allowed force the employee to take unpaid leave or to deduct any amount from the current salary that the employee is receiving.

Similarly, this application is also to be made by the employer. The application is to be made through the website <www.prihatin.perkeso.gov.my> beginning from 9 April 2020. This programme will last for a period of 3 months, beginning from 1 April 2020, or from the date the application is submitted. The last date for application will be on 15 September 2020 subject to the budget allocated for this programme and/ or the Government’s discretion. 

The employer is also required to submit a declaration as in the diagram below:

Payment will be credited to the employer within 7 to 14 days from the date of application. Take note that under this programme, the total amount that will be received by an employee will be the full amount of his/ her monthly salary. An employee that have received payment under ERP will not be entitled to this wage subsidy on the same month.

Employment Insurance System (EIS)

If you are an employee that have lost your job and during your employment, you have contributed to the EIS, you may also apply to PERKESO for financial assistance. This redress shall be available if your loss of employment is not due to:

  • Voluntary resignation;
  • Expiration of your fixed-term employment contract;
  • Unconditional termination of a service contract based on an agreement between you and your employer;
  • Completion of a project specified in a service contract;
  • Retirement; or
  • Dismissal due to misconduct on your part.

Further, you must also meet the following requirements:

  • Application must be submitted within 60 days of your loss of employment;
  • You have fulfilled the Contribution Qualifying Conditions (CQC), that is, there must be a minimum of 12 contributions being made; and
  • You must prove that you are able to work, available to work and is actively seeking for a job.

Upon approval, you will be paid Job Search Allowance (JSA) with gradual reduction rate starting from 80%, 50%, 40%, 40%, 30%, 30%, depending on your salary and CQC. If you manage to secure a job within this 6-months period of receiving JSA, you will be entitled to 25% of the total of the remaining JSA as Early Re-Employment Allowance.

Say you are supposed to be compensated RM3000 based on your monthly salary and CQC. On the first month, you will be receiving RM2400 as JSA. You will receive RM1500 and RM1200 respectively for the second and third month. On the fourth month, you managed to find a new job. You will receive RM750, which is 25% of your remaining JSA.

However, in order to qualify for every subsequent JSA, you must prove that you have been actively seeking for a new job. You will be required to complete a job search log in the portal itself. This programme comes along with additional benefits which provide RM6000 as Training Fee and RM30 as Training Allowances for vocational trainings.

Payment will be made directly to the affected employee’s account. Application to claim this benefit can be made online through PERKESO’s website:

https://eis.perkeso.gov.my/eisportal/insured/appl/instruction

If you have loss your job and are registered with EIS but do not meet the CQC, you may apply for the temporary financial incentive, SIP Plus 600. Under this programme, you will be receiving RM600 monthly for up to 3 months, and the application can also be made through https://eis.perkeso.gov.my/ .

Author profile

Bryan Ng is a Partner of a law firm and founder of Legal Warrior. With the years of hands-on experience in Court and Corporate practice, Bryan Ng has developed a deep passion for helping businesses to be successful. He advises a broad spectrum of law relating to Companies, including Company Law, Employment, and Intellectual Property Law.

Author profile

Graduated LLM Legal Practice (Barristers) at BPP Birmingham with Distinction and was called to the Bar of England & Wales on November 2019. She was awarded the highest mark in Malaysia in Equity & Trusts during LLB. She is a jelly artist that loves reading and she travels to recharge her soul.

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