PeopleX Employer of Record (EOR) Service in Malaysia

An Employer of Record (EOR) is a company that legally employs staff in Malaysia on your behalf.The EOR becomes their employer on paper and handles contracts, payroll, statutory contributions and compliance.

With PeopleX as your EOR in Malaysia, you can hire local talent without setting up your own legal entity.

An EOR works by entering into a contractual agreement with a client company to hire staff in a specific country or region where the client does not have a legal entity.

1. Contract: The client company selects a candidate and enters into a service agreement with the EOR.
2. Employment: The EOR legally hires the employee, putting them on their local payroll.
3. Compliance: The EOR assumes the legal responsibility for payroll processing, tax withholding, social contributions, and ensuring compliance with all local employment laws.
4. Work Direction: The employee reports to and receives work instructions from the client company, maintaining their operational relationship.
5. Service: The client company pays a fee to the EOR for managing all the administrative, legal, and HR functions.

You select the candidate and agree on the role and salary.

1. You sign a service agreement with PeopleX.
2. PeopleX issues a Malaysian employment contract and adds the employee to its payroll.
3. PeopleX runs monthly payroll, statutory contributions and tax, and keeps the employment compliant.
4. The employee works for you day to day, and you pay PeopleX a service fee.

With a PEO (Professional Employer Organisation), you need your own registered company in Malaysia. Your company remains the legal employer, while the PEO handles HR and payroll administration on your behalf. With an EOR, you don’t need a local entity: the EOR is the sole legal employer and takes on statutory obligations such as contracts, payroll, EPF, SOCSO and EIS. 

Companies without a Malaysian entity usually choose an EOR. Those that already have one often use a PEO or managed payroll. Note that some providers use “PEO” to describe what is effectively an EOR service, so check who the legal employer is before signing.

No. An EOR service lets you hire in Malaysia without registering an Sdn Bhd. PeopleX acts as the legal employer, so you can or build a team before deciding whether to set up your own entity.

Employment contracts that follow the Employment Act 1955

• Monthly payroll and payslips
• EPF, SOCSO and EIS contributions
• PCB/MTD tax deductions and annual EA forms
• Leave, attendance and overtime, tracked through the PeopleX HRMS app
• Ongoing compliance as Malaysian employment rules change

EOR fees cover payroll administration, compliance, legal liability and HR support. Providers usually charge in one of three ways: a percentage of the employee’s monthly salary, a fixed monthly fee per employee, or a mix of the two.

PeopleX offers transparent pricing with no hidden fees. Contact us for a quote based on your headcount.

The EOR, as the legal employer, is responsible for employment contracts, payroll, statutory contributions and tax filings in Malaysia. You stay responsible for managing the employee’s day-to-day work and performance. This split lowers your legal risk when hiring in a new country.

Hiring through an EOR is much faster than setting up a local entity, which can take months. Once the candidate and contract terms are agreed, PeopleX handles the onboarding paperwork, so the employee can start soon after.

Yes. The PeopleX HR app lets you manage EOR employees and your own-entity staff in a single view, covering leave, claims, attendance and payslips. You don’t need separate tools for each group.

Yes. Many businesses use an EOR to start hiring quickly, then set up their own Malaysian entity as the team grows. When you’re ready, the employees can be transferred to your company, and PeopleX can keep supporting you with managed payroll and the HR app.