How to hire remote employees in


Malaysia’s a modern, bustling SE Asian country with some of the world’s best remote talent. If you’re thinking about hiring in Malaysia (or if you’ve already found someone), read on—we’ll teach you how to hire in Malaysia without paying thousands in legal fees or spending months buried under paperwork.

Country snapshot

Malaysian Ringgit (MYR)
Up to 15.95%

What to know before you hire in 


Want to hire someone in Malaysia? Excellent. But, no matter where you’re from, labor laws in Malaysia are different from those in your home country (unless you’re from Malaysia, of course). Read on to learn about your options, plus as the easiest way to make remote hires in Malaysia.

If you want to successfully hire in 


, you have two options:

Hire talent as contractors

Laws about hiring contractors are significantly more simple in 


. Onboarding talent takes days, not weeks or months. Both you, the company, and your talent have more flexibility. And in many cases, since you’re remote, the talent you’re hiring is better classified as a contractor, anyway. Of course, it’s not possible in every case, but it’s what we built Panther for.

Hire talent as employees

This is the long route. You can either establish a physical presence with an entity and register as an employer, or you can use an Employer-of-Record (EOR) solution. Odds are, you’ll find using an EOR to be the easier route. Still, using an EOR in 


 is expensive—it can often be $500 per month per employee—and sometimes prone to lengthy onboarding times.

Why hire independent contractors in 


Hiring contractors is normally the easier, faster, more flexible choice—but don’t just take it from us. Below are the specific benefits and drawbacks to hiring contractors in 



It’s the fastest way to hire globally

Hiring employees takes months, at the minimum. When you hire with Panther’s locally-generated contracts, it’s a matter of days or weeks. This means you can hire the best talent, fast, without losing them to a hellish procession of paperwork.

It’s a lot cheaper

It costs just $0 to sign up for Panther, then $49 per month to hire your contractors with Panther. If you hired employees manually (or did contracting on your own), you’d likely be on the hook for thousands of dollars each month. Setting up an entity alone can cost tens of thousands of dollars.

It’s more flexible for you & your team

Hiring contractors in 


 means you’re generally not on the hook for things like health insurance and paid time off. This makes hiring flexible for you, and it gives your talent more options.

Can be less risky than hiring employees

Hiring employees is a bigger commitment, and can open you up to increased liabilities and regulations. When you hire contractors overseas, your biggest risk is misclassification—but laws surrounding contractor classification are often significantly more straightforward.

Some people want to be employees

The contractor life isn’t for everyone—some people want the security that being an employee often appears to provide. Though it’s rare, this does happen, and it’s one disadvantage of manage an all-contractor team.

You might not have as much control over your talent

Most countries’ contractor-employer relationship laws stipulate that the employer can’t set fixed working hours, among other things. These laws give contractors more freedom over how and when they do their work than an employee would have. In reality, however, most contractors are willing & able to work on the company’s schedule—it’s a matter of setting expectations beforehand.

How can I pay people in 



If you’re hiring contractors in 


, you can pay them with Panther in a single click. You won’t need to worry about complicated wire transfers, fees, or currency conversions. We’ll take care of it all. Just make a click and your contractor will get paid in their currency of choice. This is a valuable bonus for talent in countries where the local currency is particularly weak—most people appreciate the ability to receive their payment in stronger currencies.

Hiring and paying your team in 


Hire and pay with Panther

Pay everyone with a single click
Get great currency conversion rates
Pay $0 in platform fees
Run payroll in seconds
Let Panther automatically create & store invoices
Let Panther automatically write locally-compliant contracts
Let Panther automatically file local tax documents

Hire and pay without Panther

Pay all your contractors individually
Do all currency conversions yourself
Shoulder the burden of platform fees
Spend hours each month making payments
Manually track & store invoices
Manually write & sign contracts
Manually file relevant tax documents

Let Panther save you from hiring headaches.

Sign up today for $0

If you want to hire employees in 


If you’ve read up until this point, you’ll know that it’s easier, cheaper, and more flexible to hire contractors in Malaysia than employees. Still, there are valid reasons why you might want to hire employees instead. The content below is for you—we’ll cover employer taxes and obligations in Malaysia.

Taxes in 


Employer tax

Provident Fund (employees under the age of 60)

Provident Fund (employees over the age of 60)

Social Security (SOCSO)

Employment Insurance (EIS)

Human Resource Development Fund (over 10 employees)

Individual tax


Paid Time Off (PTO)

PTO is calculated by the:

  • Up to two years of employment: 8 days per year
  • Between 2 to 5 years: 12 days per year
  • 5+ years: 16 days per year 

Public Holidays

There are 6 compulsory public holidays and 10 optional public holidays (employer should choose at least 5 of these but it is common for offices to close on all).

State day is a compulsory public holiday and the day varies from state to state. All other holidays are national.

Sick Days

The duration of sick leave entitlement provided to workers is dependent on how long they have been employed by their employer:

  • Up to two years of employment: 14 days per year
  • Between 2 to 5 years: 18 days per year
  • 5+ years: 22 days per year

Maternity Leave

Female employees are covered in full by the employer for a least 90 days if they have been employed in the last four months and have worked for the same employer for at least 90 days in the 9 months prior to childbirth.  

Paternity Leave

There are no provisions in the law regarding paternity leave for the private sector, however, in the public sector, fathers are entitled to 7-14 days.

Parental Leave


Other Leave


Marriage Leave


Bereavement Leave



Termination Process

Employees can be dismissed for misconduct or poor work performance. Termination is subject to employee challenge for unfair dismissal.

It is recommended that proper procedure is followed (warning, time and guidance to improve performance) in order to reduce the likelihood of an unfair dismissal claim.

Notice Period

The notice period in Malaysia is:

No set amount but should be equitable between employee and employer.

Severance Pay

Minimum termination benefits for employees who are fired for reasons not connected to their conduct are as follows:  

  • Up to two years of employment: 10 days per year
  • Between 2 to 5 years: 15 days per year
  • 5 plus years: 20 days per year   

Probation Period

Probation is optional. The common practice is to have 1-3 months probations.

The Employment Act does not distinguish between employees on probation and permanent employees.

Employee requirements in 


Working Hours

Working hours are limited to 48 hours per week. The most common office practice is 45 hours per week (9 am-6 pm, Mon-Fri)


The minimum guideline for overtime pay in the Employment Act is:

  • Extra hours worked on a normal working day  – 150%
  • Rest days – 200%
  • Public holidays  – 300%

The Employment Act only covers manual workers and non-manual workers with a monthly salary that does not exceed RM 2,000. However, these guidelines are often used as guidance in Common Law cases for other employees.

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