Malaysia moves to protect cross-border workers with new social security law

Malaysia is set to strengthen social security protection for hundreds of thousands of cross-border workers by amending its employment laws to cover commuters travelling daily between Johor and Singapore, closing long-standing insurance gaps that have left many workers vulnerable in the event of accidents.

The Ministry of Human Resources is expected to table amendments to the Self-Employment Social Security Act 2017 (Act 789) in the Dewan Rakyat next month, introducing a new "Commuter Scheme" aimed at extending protection to Malaysians who cross the Johor-Singapore Causeway for work.

The proposed amendment seeks to address what officials describe as a "no man's land" on the Causeway, where jurisdictional issues often prevent accident victims from claiming compensation under either Malaysian or Singaporean insurance policies.

According to the Social Security Organisation (Socso), around 480,000 Malaysians commute daily between Johor and Singapore, making one of the world's busiest border crossings while facing significant road safety risks. Data cited by Socso indicates that nearly one cross-border commuter dies in a traffic accident every week, amounting to about 52 fatalities annually in the Causeway area.

Edmund Cheong Peck Huang, Deputy Chief Executive (Strategy & Corporate Affairs) of Socso, said the core issue is not the absence of insurance but the inability of existing policies to provide seamless protection across jurisdictions.

He explained that Malaysian insurance typically does not cover accidents occurring in Singapore, while Singapore-issued policies may not provide coverage for incidents in Malaysia. Even workers who purchase insurance in both countries can still encounter coverage gaps if accidents occur on the Johor-Singapore Causeway.

To address this, the proposed legislation will introduce a specialised self-contribution scheme, allowing cross-border workers to voluntarily fund their own social security coverage. The scheme is designed to provide continuous protection whether workers are in Malaysia, Singapore or travelling through the transit zone connecting the two countries.

The initial phase of the programme will focus on employment-related accidents and commuting risks, with authorities planning to expand it into a broader social security framework over time.

Cheong noted that Socso cannot require Singaporean employers to participate in the scheme, making voluntary worker contributions the most practical solution. He added that authorities are prioritising accident protection first because commuting remains the greatest risk faced by cross-border workers.

The proposed amendment forms part of Malaysia's broader efforts to strengthen social protection and ensure workers are not left without compensation due to cross-border legal and insurance limitations.