Malaysia’s Labour Laws for Hiring Game Designers: EPF, SOCSO & Compliance

The gaming scene in Malaysia is booming, from indie studios to global publishers, and skilled game designers are in high demand. Companies looking to tap into this talent quickly realize that Malaysia offers not just creativity and technical skills, but also a workforce protected by solid labour laws and social security systems.

However, understanding Malaysia’s employment compliance, including contributions to EPF, SOCSO, and EIS, can be daunting, especially for foreign employers or creative startups new to the region.

In this guide, we will help you understand the essentials of hiring and managing game designers in Malaysia, covering payroll compliance, legal obligations, and recruitment best practices, plus how FastLaneRecruit’s Employer of Record (EOR) service can simplify the entire process.

Understanding Employment Compliance in Malaysia

Before hiring game designers in Malaysia, it’s essential to understand how local labour laws work, not just to stay compliant, but to ensure your employees are fairly protected and motivated.

The Foundation: Malaysia’s Employment Act 1955

The Employment Act 1955 is the main legislation that governs employment in Malaysia. It outlines:

• Employee rights — such as working hours, leave entitlements, termination procedures, and overtime pay.
• Employer obligations — including payroll accuracy, timely salary payments, and statutory contributions.
• Fair working conditions — ensuring both local and foreign employees are treated equitably.

For example, under the Act:

• A full-time game designer is entitled to a standard workweek (usually 48 hours or less) and paid annual leave.
• Employers must issue payslips, keep employment records, and contribute to statutory funds every month.

But employment compliance in Malaysia doesn’t stop at contracts and salaries, it also covers statutory contributions that protect employees’ long-term welfare.

Also Read: Top 10 Software Outsourcing Companies in the Philippines

Statutory Contributions: The Backbone of Employment Protection

Malaysia’s employment system ensures that workers, including creative professionals like game designers, are covered by several mandatory contribution schemes. These ensure employees have financial security, social protection, and access to career development programs.

Breaking Down Each Contribution (With Examples)

1. Employees Provident Fund (EPF)

The EPF, or Kumpulan Wang Simpanan Pekerja (KWSP), is a retirement savings fund. 

Both the employer and employee contribute monthly, helping workers build long-term savings for retirement.

Example:
Let’s say you hire a Game Designer in Kuala Lumpur with a monthly salary of RM6,000.

• Employer contributes 12%, which equals RM720
• Employee contributes 11%, which equals RM660
  So, RM1,380 in total is deposited monthly into the employee’s EPF account.

This savings grows with dividends each year, and employees can access part of it for housing, education, or retirement, a major benefit of formal employment in Malaysia.

2. SOCSO (Social Security Organisation)

SOCSO, managed by PERKESO, protects employees against workplace accidents, injuries, and disabilities.

Example:
If a game artist slips at the office and can’t work temporarily, SOCSO helps cover medical expenses and lost income during recovery.

Employers contribute 1.75% of wages, while employees pay 0.5%, a small cost for strong safety coverage.

3. EIS (Employment Insurance System)

The Employment Insurance System, also run by PERKESO, offers financial support and retraining opportunities for employees who lose their jobs involuntarily (e.g., retrenchment or company closure).

Example:
If your studio scales down and a junior level designer loses their job, EIS provides temporary income support and helps them find new work through job placement programs.

Both employer and employee contribute 0.2% each, a total of 0.4% of wages monthly.

4. PCB/MTD (Monthly Tax Deduction)

The Monthly Tax Deduction (Potongan Cukai Bulanan or PCB) is the employee’s income tax, withheld and remitted by the employer to the Inland Revenue Board (LHDN) each month.

Example:
If your senior game designer earns RM8,000 monthly, you must calculate and deduct their income tax according to the latest LHDN tax tables, then pay it on their behalf.

Employers don’t pay tax for employees — they simply withhold and transfer it.

5. HRDF (Human Resources Development Fund)

The HRDF, under HRD Corp, helps Malaysian employees upskill through certified training and development programs.

Employers with 10 or more employees must contribute 1% of their monthly payroll, which they can claim back for training courses.

Example:
If your game studio invests in Unity 3D training or UX workshops for designers, you can get cost reimbursement through HRDF, turning compliance into a competitive advantage.

Also Read: Front-End Development Outsourcing: Pros and Cons

Why Compliance Matters for Game Studios

For companies in creative industries, especially game development, compliance builds trust and stability.
It shows that you value your designers not just as talent, but as professionals with long-term career security.

Non-compliance, however, can result in:

• Fines and penalties from EPF or PERKESO
• Reputational risk, especially when expanding regionally
• Legal disputes if employees aren’t properly covered under local law

Tip: Employee vs. Independent Contractor

If you’re hiring remote or project-based game designers, always clarify whether they’re employees or independent contractors.

• Employees:
  
  • Must receive benefits like EPF, SOCSO, and EIS contributions.
  • Work under your direct supervision or full-time arrangement.
    
• Independent contractors/freelancers:
  
  • Manage their own taxes and contributions.
  • Typically engaged for specific projects with flexible terms.

Example:
If you hire a 3D artist in Malaysia to work on a single 2-month project for your overseas studio, they’re likely a contractor, not an employee.
However, if the same artist works full-time under your schedule and reports to your creative director, they’re an employee, meaning you must comply with EPF, SOCSO, and EIS obligations.

Hiring Game Designers in Malaysia: Skills, Roles, and Challenges

Hiring a game designer isn’t just about finding someone who loves games; it’s about identifying creative professionals who can blend artistry, storytelling, gameplay mechanics, and teamwork to bring an idea to life. In the gaming world, a brilliant concept can fail without the right design logic, player engagement, and cross-functional collaboration.

Malaysia has become one of Southeast Asia’s fastest-growing game development hubs, thanks to its strong creative talent pool, competitive labour costs, and government support for digital industries. For global studios, building a Malaysian game design team offers the ideal balance between creativity and technical expertise.

Key Game Design Roles and Salaries in Malaysia (2025 Estimates)

Here’s an overview of common game design roles, their responsibilities, and average salary ranges in Malaysia, with approximate USD conversions for global recruiters (based on RM1 = USD 0.21).

(Salary ranges based on FastLaneRecruit’s 2025 Game Design Salary Report and market data from JobStreet and Glassdoor.)

Also Read: Malaysia: A Rising Hub for Offshore Front-End Development Talent

What Makes a Great Game Designer

According to veteran designer Arnold Hendrick, the best game designers combine creativity with analytical structure. They’re not just dreamers, they’re architects of player experience.

Here are the top qualities to look for when hiring in Malaysia:

1. Strong Writing and Communication Skills

A great game designer must explain gameplay ideas clearly, whether in a design document or during a team briefing.

For example, if a level designer proposes a puzzle mechanic, they should be able to describe its rules, player goals, and visual cues in a way that both artists and programmers can implement.

2. Broad Knowledge Base

Designers benefit from understanding art, sound, storytelling, and user psychology.

A UX designer who understands colour theory and human behaviour can dramatically improve player engagement and satisfaction.

3. Team Collaboration

Game development is highly cross-functional. Designers must work seamlessly with programmers, animators, and producers. 

In a Malaysian studio setup, often multicultural and hybrid collaboration skills ensure smoother production pipelines.

4. Analytical and Logical Thinking

Beyond creativity, designers need to translate concepts into data-driven mechanics. They use player feedback, analytics, and testing to refine experiences.
For instance, if analytics show players drop off after Level 3, the designer needs to adjust pacing or difficulty.

Pro Tip: Assess Creativity and Communication — Not Just Portfolios

When recruiting game designers in Malaysia (or remotely), don’t rely solely on resumes or portfolios.

Instead, evaluate writing samples, game prototypes, and communication style. Ask candidates to walk you through a design decision they’ve made, how they identified a gameplay problem and solved it collaboratively.

This not only tests their creativity but also their ability to work within structured production environments, a crucial skill for global game projects.

Example: Hiring Through FastLaneRecruit

Let’s say a Singapore-based studio wants to expand its production capacity by hiring a Malaysian UX designer and level designer.

Through FastLaneRecruit’s Employer of Record (EOR) service, the studio can legally employ Malaysian talent without setting up a local entity. FastLaneRecruit manages payroll, EPF, SOCSO, EIS, and ensures full compliance with Malaysian labour laws so the company can focus on creative development, not administrative hurdles.

Also Read: Hiring Front-End Developer Teams in Malaysia

Payroll, Record Keeping & Compliance Tips for Hiring Game Designers in Malaysia

Once your Malaysian game design team is on board, the next big step is ensuring payroll and statutory compliance. This isn’t just about paying salaries on time; it’s about meeting every legal requirement set by the Malaysian government to protect both employers and employees.

Whether you’re hiring locally or through a remote employment model, accurate payroll management helps you build trust, prevent compliance issues, and maintain smooth operations, especially when handling multiple creative roles such as lead designers, level designers, or UX specialists.

Record Keeping: The Foundation of Compliance

In Malaysia, employers are legally required to keep detailed payroll and employment records for at least seven years. These records are crucial for audits, employee claims, and tax filings, especially if you’re working with multiple freelance or full-time game designers.

Essential records to maintain include:

• Salary slips – showing monthly gross and net pay, statutory deductions (EPF, SOCSO, EIS, tax).
• Employment contracts – including job titles, salary terms, benefits, and working hours.
• Contribution reports – proof of monthly EPF, SOCSO, and EIS submissions.
• Tax documents – such as Form EA (annual employee income statement) and PCB/MTD deduction records.
• Leave and attendance logs – useful for calculating overtime, annual leave, or project-based payments.

Example:
If you’re employing a UX/UI designer on a six-month contract to develop a mobile game interface, ensure their employment terms, EPF registration, and monthly payslips are stored digitally. This makes it easy to verify their contributions and contract completion if audited by LHDN (Inland Revenue Board of Malaysia).

Tip:
Avoid manual or paper-based record keeping. Instead, use cloud-based payroll platforms like Talenox, Kakitangan, or Swingvy, which integrate directly with KWSP (EPF), PERKESO (SOCSO), and LHDN portals, making compliance tracking simple and transparent.

Monthly Payroll Obligations Checklist

To make payroll management easier, here’s a checklist of key monthly deadlines and submissions every employer in Malaysia must meet.

Pro Tip:
Always schedule payroll submission reminders in your HR system. Missing a single EPF or SOCSO deadline can lead to fines, late payment interest, or legal notices under Malaysian labour laws.

Also Read: Front-end Developer Salary Guide 2025

Automating Compliance: Recommended Tools & Practices

Modern payroll systems can significantly reduce administrative workload. When hiring remote or hybrid game design teams, automation ensures consistent, error-free statutory reporting, especially when managing multiple hires across different salary bands.

Recommended practices include:

1. Use payroll software integrated with statutory systems – e.g., Talenox, PayrollPanda, or Swingvy — these platforms automatically calculate EPF, SOCSO, EIS, and tax deductions based on current government rates.
   
2. Digitize employee records – including contracts, payslips, and contribution receipts.
   
3. Conduct quarterly compliance audits – verify submission receipts against EPF, PERKESO, and LHDN records.
   
4. Provide transparent payslips – employees should clearly see how much is deducted and contributed monthly.

Example:
A game development startup in Kuala Lumpur using Talenox integrated payroll can automatically generate payslips and submit statutory contributions. This saves time and avoids manual errors, allowing the founders to focus on game design innovation instead of paperwork.

Key Payroll Tips for Global Employers

If you’re a foreign studio or global gaming company hiring Malaysian designers, you must follow local payroll and tax laws even for remote employees. This includes ensuring EPF registration, SOCSO coverage, and income tax deductions are done through a Malaysian-registered entity.

However, if setting up a local office isn’t feasible, you can use a compliant alternative such as an Employer of Record (EOR).

FastLaneRecruit’s EOR Solution: A Smarter Way to Hire in Malaysia

Managing payroll compliance across borders can be complex, especially for creative teams where roles evolve quickly. With FastLaneRecruit’s Employer of Record (EOR) service, your company can legally hire and pay Malaysian game designers without setting up a local entity.

FastLaneRecruit handles:

• Employment contracts compliant with the Employment Act 1955
• EPF, SOCSO, and EIS registrations and payments
• Monthly tax deductions (PCB/MTD)
• Payroll processing and record keeping
• Cross-border payment and compliance reporting

This ensures your Malaysian team is fully protected under local law while your studio focuses on what matters most: creating amazing games.

Explore FastLaneRecruit’s EOR Services to streamline compliant hiring in Malaysia.

Common Mistakes Foreign Employers Make When Hiring in Malaysia

Even experienced global studios expanding into Malaysia can face unexpected compliance challenges. The country’s labour system requires careful attention to statutory contributions, accurate record-keeping, and correct employment classification. Overlooking these details can lead to fines, back payments, or even legal disputes.

Below are the most common compliance mistakes foreign employers make when hiring local or remote game designers in Malaysia and practical ways to prevent them.

Misclassifying Game Designers as Contractors

Mistake:
Foreign employers sometimes classify full-time game designers as freelancers or independent contractors to simplify payroll or avoid statutory contributions.

Impact:
If the designer works fixed hours, reports to a supervisor, or uses company tools, they are considered employees under the Employment Act 1955. Misclassification can result in missed EPF and SOCSO payments, tax non-compliance, and legal penalties.

How to Avoid It:

• Review employment relationships under the Employment Act 1955. If the person works under your control and receives a regular salary, they are legally an employee.
• Clearly state the employment type in the offer letter or agreement.
• Consider using a hybrid model if you engage both full-time and project-based designers.

Tip: Partnering with a local HR provider or an Employer of Record (EOR) such as FastLaneRecruit can help you classify roles correctly and stay compliant with Malaysian labour regulations.

Also Read: Payroll & Compliance Guide for Hiring Malaysian Front-end Developers

Late Statutory Submissions

Mistake:
Failing to submit EPF, SOCSO, or PCB (Monthly Tax Deduction) payments by the required date, typically the 15th of the following month.

Impact:
Late submissions can lead to penalties, interest charges, and possible audits by KWSP (EPF), PERKESO (SOCSO), or LHDN (Inland Revenue Board). Repeated delays may also damage your company’s compliance record.

How to Avoid It:

• Set up automated reminders or use payroll software that integrates with government portals.
• Assign a payroll administrator to monitor monthly submissions.
• Review statutory payment records monthly to ensure timely compliance.

Recommendation: Use Malaysian payroll platforms such as Talenox or PayrollPanda, which automatically calculate and submit contributions to statutory agencies.

Incomplete or Poor Record Keeping

Mistake:
Relying on paper-based systems or failing to maintain essential employee records such as payslips, employment contracts, and contribution receipts.

Impact:
In the event of an audit or dispute, missing or inaccurate documentation can lead to non-compliance findings or penalties.

How to Avoid It:

• Store all employment and payroll records digitally for at least seven years, as required by law.
• Include timestamps and maintain clear version histories for all payroll records.
• Regularly back up data on secure cloud storage.

Tip: Adopt HR and payroll software like Swingvy or Kakitangan to centralize and protect employee data while simplifying future audits.

Ignoring Salary Thresholds and Contribution Rates

Mistake:
Failing to stay updated on the latest EPF rates, minimum wage adjustments, or Employment Act salary thresholds.

Impact:
Incorrect contributions or salary underpayment can lead to compliance breaches, employee dissatisfaction, and potential back payments.

How to Avoid It:

• Monitor updates from official sources such as KWSP (EPF), PERKESO, and LHDN.
• Use payroll software that updates statutory contribution rates automatically.
• Conduct annual salary and compliance reviews to ensure ongoing adherence to Malaysian standards.

Example:
If an employer continues paying a game designer below the updated national minimum wage, it may result in backdated payments and legal action under the Employment Act 1955.

Overlooking Local Holiday and Leave Entitlements

Mistake:
Applying foreign company policies instead of adhering to Malaysia’s mandatory public holiday and leave entitlements.

Impact:
Employees may lodge complaints with the Labour Department (JTKSM) for non-compliance with paid leave or public holidays, which can lead to fines or disputes.

How to Avoid It:

• Follow the Employment Act’s minimum requirements, including at least 8–16 annual leave days and 11 paid public holidays.
• Customize your internal HR policies to align with Malaysian laws.
• Communicate all leave entitlements clearly in your employment contracts.

Tip: Configure your payroll or HR system to automatically calculate leave balances and public holiday pay based on Malaysian standards.

Not Registering with Statutory Authorities

Mistake:
Newly established foreign entities sometimes forget to register with Malaysian statutory bodies such as KWSP, PERKESO, or LHDN.

Impact:
Failure to register can result in substantial fines, backdated contribution requirements, or legal action.

How to Avoid It:

• Register your business with all relevant authorities upon incorporation.
• Register employees within seven days of their start date.
• If you do not have a legal entity in Malaysia, work with an EOR partner to handle compliance, payroll, and statutory registration on your behalf.

Recommendation: FastLaneRecruit’s Employer of Record (EOR) service helps foreign employers hire Malaysian professionals legally and manage EPF, SOCSO, and tax obligations seamlessly.

Key Takeaway: Prioritize Compliance from Day One

By integrating payroll management, accurate classification, and record keeping into your hiring strategy, you’ll build a compliant and reliable presence in Malaysia. Proactive compliance not only prevents penalties but also helps attract top creative talent who value transparent and fair employment practices.

Pro Tip: Conduct an internal HR compliance audit annually or rely on FastLaneRecruit’s EOR solution to manage your statutory duties and ensure ongoing compliance under Malaysian labour law.

Also Read: DevOps Engineer Salary Guide 2025

Example Scenario: Hiring a Malaysian Game Designer

Let’s imagine a real-world scenario to understand how employment compliance works in Malaysia.

Scenario:
A Singapore-based gaming startup is expanding production for a new mobile RPG game and wants to hire a Lead Game Designer based in Kuala Lumpur. The company wants to tap into Malaysia’s growing creative talent pool but doesn’t have a local entity or HR team in the country.

Option 1: Hiring Without Local Support

If the startup decides to hire the designer directly without any local support, it will face several administrative and legal hurdles:

Challenges:

• High upfront costs for company incorporation
• Complex monthly compliance and payroll filings
• Need for dedicated HR or finance staff
• Risk of misclassification or incorrect tax handling

Without local expertise, the process can take months and distract the startup from its primary goal, building and launching its game.

Option 2: Hiring Through FastLaneRecruit’s EOR Solution

This is where FastLaneRecruit’s Employer of Record (EOR) service makes a significant difference.

By partnering with FastLaneRecruit, the Singapore startup can hire its Malaysian Lead Game Designer quickly and legally, without setting up a local entity.

Result:
The designer works legally and receives all statutory benefits (EPF, SOCSO, EIS), while the Singapore startup remains fully compliant with Malaysian employment laws. The company can focus on creative production, game testing, and scaling without worrying about payroll, tax filings, or HR administration.

Tip for Global Employers:

If you plan to expand your game development or design team in Malaysia, using an EOR solution like FastLaneRecruit offers several key advantages:

• Rapid hiring — onboard employees in days, not months
• Full legal compliance under Malaysian labour law
• Reduced operational costs (no need for entity setup)
• Seamless integration of payroll, benefits, and tax compliance

Recommendation:
Before hiring, assess whether your role qualifies as “employee” or “contractor” under Malaysian law. This distinction affects EPF, SOCSO, and tax responsibilities. If unsure, consult Malaysia’s Employment Act 1955 or work with a trusted EOR partner such as FastLaneRecruit to ensure correct classification and compliance.

Conclusion

Hiring game designers in Malaysia opens doors to a diverse pool of creative, English-proficient professionals. But compliance with local labour laws, especially contributions to EPF, SOCSO, and EIS, is non-negotiable.

Whether you’re an international game studio or a fast-growing tech company, understanding Malaysia’s employment system ensures your creative workforce is protected and your operations are compliant.

Build Your Game Design Team in Malaysia — The Smart, Compliant Way

Expanding your creative or game development team into Malaysia doesn’t have to be complicated. With FastLaneRecruit’s Employer of Record (EOR) services, you can hire top Malaysian game designers without setting up a local entity.

FastLaneRecruit manages every aspect of employment from onboarding and payroll to statutory compliance and employee benefits, so your studio can focus entirely on production, innovation, and storytelling.

Ready to hire game designers compliantly in Malaysia?
Contact FastLaneRecruit today to discover how our EOR solution can help you build and manage your creative team with confidence, fully compliant, fully supported, and ready to scale. 

Get in Touch with FastLaneRecruit!