Malaysia: Why protecting gig workers matters

KUALA LUMPUR – The rights of gig workers are poised to take centre stage in Malaysia, with a bill seeking to secure protections for gig economy workers set to be tabled next month.

The proposed Gig Economy Workers’ Act is intended to offer contingent workers labour protections akin to those enjoyed by permanent employees.

This landmark legislation would extend social security benefits and establish a clear path for the redress of grievances – two key pillars of stability that are often missing in the platform-driven world of gig work.

Deputy Prime Minister Datuk Seri Ahmad Zahid Hamidi lauded Malaysia’s forward-thinking approach, stating: “Malaysia is one of the first five countries worldwide to establish a commission dedicated to the gig economy.”

Data presented by Ahmad Zahid underscores the significance of this move: 1 in every 4 workers in Malaysia is now classified as self-employed, totalling roughly 3 million, with 1.5 million of these being freelancers.

The Gig Economy Workers’ Act at a glance

This legislative blueprint is expected to introduce a range of critical protections, including:

• Minimum wage requirements
• Social security benefits, granting access to health insurance, retirement plans, and other safeguards
• Work injury compensation
• Unionisation rights and the ability to bargain collectively
• Anti-discrimination measures

Meanwhile, a grievance mechanism would address a spectrum of issues, including:

• Unfair treatment: Complaints of discrimination or harassment based on race, gender, or other personal traits
• Payment disputes: Concerns over delayed or insufficient payments for services rendered
• Workplace safety: Reports of unsafe conditions or inadequate safety provisions
• Contractual clarity: Issues related to vague or unfair contract terms between gig workers and platforms
• Benefits access: Complaints over denied benefits, such as insurance or health coverage

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Malaysia’s HR Ministry developed the provisions outlined in the Act, while the Deputy Prime Minister took charge of overseeing the establishment and functions of the Malaysian Gig Economy Commission (SEGiM).

SEGiM’s mission will be to ensure fair pay and welfare protections for gig workers, backed by government support.

For instance, Malaysia’s 2025 budget earmarked 100 million ringgit (approx. US$21 million) to cover 70% of social contributions for self-employed individuals. This support scheme, set to cover around 500,000 contingent workers – including private-hire drivers, food delivery riders, and content creators – demonstrates the government’s commitment to uplift the gig economy.

HR Minister Steven Sim is optimistic that the proposed law will bring much-needed order to the fast-evolving gig economy.

“The new law will have four main pillars: definition of a gig worker or a platform worker; minimum compensation in the form of earning for p-hailing and e-hailing workers; grievance mechanism; and social security protection, especially in terms of social insurance and pension,” Sim said, as quoted by The Star.

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Why safeguarding gig workers’ rights matters

In a free-market landscape, companies and individuals can hire workers on a short-term basis, avoiding the usual trappings of traditional employment contracts. However, this flexibility often leaves gig workers vulnerable to exploitation.

“The informal nature of gig work, mediated through digital platforms, poses unique challenges in ensuring fair labour practices and safeguarding workers’ rights,” explained Naveen Kumar, a legal expert commenting on India’s own gig economy.

“Thus, there is a rising concern for the gig workers’ right to basic amenities as they move from one job to another quickly and don’t have any substantive legal protection, and several times it can be extremely tough for them.”

Datuk Seri Dr Mohammed Azman Aziz Mohammed, CEO of Malaysia’s Social Security Organisation, added that overlooking gig workers’ needs signals a failure in inclusivity.

“While formal employees often have access to social protections like unemployment insurance, health benefits and pensions, self-employed and platform workers frequently find themselves excluded from these essential safeguards,” he said.

“This discrepancy is not just a gap in policy, rather it is a gap in our collective humanity. It is a gap in justice.”