Social Security Protection Principles
SOCSO was mandated to administer and enforce the Employees’ Social Security Act 1969 (Act 4) and Employees’ Social Security General Rules 1971, Self-Employment Social Security Act 2017 (Act 789) and Employment Insurance System Act 2017 (Act 800).
The Employment Injury Scheme and the Invalidity Scheme under Act 4 allow SOCSO to provide free medical treatment, facility for physical or vocational rehabilitation, and financial assistance to employees if the accidents or diseases have reduced their abilities to work or rendered them incapacitated. If an employee dies, his/her dependants are provided for financially through pensions.
Foreign workers are covered under Act 4, while self-employed individuals are covered under Act 789. These groups are only eligible for the Employment Injury Scheme.
Three core principles of SOCSO are as follows:
i) Solidarity Fund
Solidarity is the cardinal value of social protection. In practice, it is a series of mechanisms for the redistribution of income towards people who are disabled or invalid and families with dependant children. Generally, contributions made by its members to SOCSO is channelled to the solidarity fund. The determining factor when calculating the quantum for an employee to contribute is based on an employee’s monthly salary. Through this understanding, employees share the same level of exposure and risk sharing regardless of industry in which they operate in.
Sharing of risk in this context brings the understanding that all contributors agreed and united in allowing SOCSO to use the solidarity fund to to pay benefits to employees who suffer disability or invalidity and pension to dependants in the case of death.
For employees who have not received any benefits until retirement, they actually helped other employees who suffer disabilities or invalidity and help families who have lost members due to death. In the long term, this may also be happening to their families. At that time with the same concept in which the retiree contributions and other contributors also been used to help their families based on the core principles of 'solidarity fund'.
ii) Replacement of Income
This principle applies when determining the amount of benefit payments. It is related to the amount of contributions paid based on the employees' salary. This concept is to ensure that the employees do not feel financially affected if they have disabilities or invalidity. In the case of death of an insured person, replacement of income is provided to dependants through monthly pensions.
The fundamental basis of this principle is within the Act and Regulation itself. By virtue of the concept of social justice, the coverage of the scope must encompass all employers and employees registered to SOCSO.
Through this concept, prevention of accidents with the objective of zero accident and foster a culture of healthy lifestyle should be implemented because the real definition of social security is keeping employees in the workforce until retirement. If this can be done, the real income of an employee would be higher, in line with the new economic model that focuses on high income society. This concept also provides space and opportunity for a motivated employee to return to work. Rehabilitation is also given to employees who suffer disability and invalidity.
In conclusion, payment of benefits made to eligible employees or dependants under the Employees’ Social Security Act 1969 and Employees’ Social Security (General) Regulations 1971. This is to ensure that fairness and equality to all employees are achieved to those that have contributed to the solidarity fund. In the spirit of fairness, service is rendered with the aim to delight the customer and to go beyond their expectations. To this end, SOCSO endeavours to execute benefit payments as fast and accurate as possible.