WHAT DOES THE INVALIDITY PENSION SCHEME COVER AND THE BENEFITS PROVIDED ?
Invalidity Pension Scheme provides a 24-hours coverage to employees against invalidity and death due to any cause not connected with employment before the age of 55 years.
The benefits provided under this scheme are Invalidity Pension, Invalidity Grant, Constant Attendance Allowance, Survivors Pension, Funeral Benefit, Rehabilitation and Educational Loan.
- Invalidity Pension
For the purpose of Invalidity Pension, invalidity means a serious disease or disablement of a permanent nature that is either incurable or not likely to be cured, as a result of which an employee is unable to earn at least 1/3 of what a normally able person could earn.
Heart attack, kidney failure, cancer, mental illness, chronic asthma and other similar conditions are chronic ailments or diseases that could be considered for invalidity.
The following conditions must be fulfilled by an employee to be eligible for Invalidity Pension :
- at the time the notice of invalidity is received, the employee has not completed the age of 55 years
- if the employee has completed the age of 55 years when the notice of invalidity is received, such employee has to provide proof that the invalidity occurred before 55 years and he had ceased employment at that time.
- certified as an invalid by a Medical Board or Appellate Medical Board
- has fulfilled the contribution qualifying conditions.
There are 2 contribution qualifying conditions :
- full qualifying condition
- reduced qualifying condition.
An employee is deemed to have fulfilled the conditions of full contribution qualification if
- before the month in which the notice of invalidity is received, an employee's monthly contributions within a period of 40 consecutive months must be at least 24 months.
- an employee has made monthly contributions for at least 2/3 of the number of full months in the period between the date of first coverage under the Invalidity Pension Scheme and the date the notice of invalidity is received by SOCSO. This is subject to the condition that the total number of monthly contributions made during the stated period, is at least 24.
- Invalidity Grant
This is an outright payment paid to worker or employee who does not qualify for the Invalidity Pension, as he does not meet any of the contribution qualifying conditions stated, but has made at least 12 monthly contributions. The Invalidity Grant is equivalent to the total amount of contributions paid by the employee and the employer for the Invalidity Pension Scheme including the interest thereof.
If an employee is severely incapacitated and requires constant personal attendance, the recipient of Invalidity Pension is also entitled to Constant Attendance Allowance. The Medical Board or an Appellate Medical Board will decide on the eligibility to receive this allowance and will pay the recipient of the benefit directly. Subject to a maximum of RM500 per month, the benefit is 40% of the rate of Invalidity Pension.
- Survivors Pension
Where an employee dies in any of the following situations, irrespective of the cause of death, the dependants will be paid Survivors Pension :
- while an employee is receiving invalidity pension irrespective of his age
- an employee who is not a recipient of the invalidity pension and has not reached the age of 55 years but met either the full contribution qualifying condition or the reduced contribution qualifying condition.
Where the deceased is a recipient of Invalidity Pension, the rate of the Survivors Pension is equivalent to the rate of the Invalidity Pension received by him.
Where the deceased is not a recipient of the Invalidity Pension and has met the full contribution qualifying conditions, the full rate of the Survivor's Pension is between 50% to 65% of the average monthly wage depending on the number of contributions made in his behalf.
The rate of Survivors Pension will be 50% of the average monthly wage for an employee who meets the reduced contribution qualifying condition.
Dependants who are entitled for the pension are the same as those under the Dependent Benefit of Employment Injury Scheme.
- Funeral Benefit
This benefit is paid to the eligible next-of-kind if an employee dies :
- while receiving Invalidity Pension
- before reaching the age of 55 but meets the full or reduced qualifying contribution conditions.
The amount and the persons qualified to receive this benefit are the same as those under the Employment Injury Scheme
- Rehabilitation Benefit
An employer who suffers invalidity is also entitled to receive Rehabilitation Benefit as provided under the Employment Insurance Injury Scheme
The total contribution for the Invalidity Pension Scheme is about 1% of the wages of an employee and is shared by the employer and the employee equally.