Parliament passes landmark Gig Workers Bill, extending long-overdue protections to 1.2 million Malaysians

Parliament has approved the Gig Workers Bill 2025, a long-anticipated law that formally recognises gig workers as a distinct category in Malaysia’s labour market and extends essential protections to more than 1.2 million people who rely on platform and freelance work for their livelihoods.

A new legal status for gig workers

The legislation acknowledges gig workers as neither traditional employees nor independent contractors, establishing a tailored framework that reflects the realities of platform-based and freelance work. Central to the law are mandatory written service agreements between workers and contracting entities. These agreements must clearly set out terms of payment, working arrangements, insurance coverage, and procedures for suspension or termination.

Human Resources Minister Steven Sim Chee Keong said the law addresses longstanding protection gaps that have left gig workers vulnerable. He told Parliament that for too long gig workers were operating without proper recognition despite their vital role in the economy, and that the bill “ends that injustice.”

Minimum standards and fair practices

The law applies to a wide spectrum of gig workers, including e-hailing and p-hailing drivers, freelancers, and digital content creators. Platforms and companies—such as Grab and Foodpanda—are now required to provide contracts that meet minimum standards for clarity and fairness.

To curb unfair practices, the bill prohibits unilateral changes to pay rates, arbitrary account deactivations, and restrictions that prevent workers from operating across multiple platforms. This aims to increase transparency, enhance income stability, and strengthen workers’ bargaining position.

Dispute resolution and due process

The law establishes a Gig Workers Tribunal with powers to hear disputes and order remedies such as reinstatement, compensation, or payment of outstanding earnings. Crucially, it guarantees workers the right to be heard before any suspension. If a suspension is found to be unjustified, the worker must be compensated with half of their average daily earnings—an important safeguard that was previously unavailable.

The scale of Malaysia’s gig economy

As of the first quarter of 2025, Malaysia’s total labour force stands at 16.7 million. Of these, 3.45 million are engaged in informal employment, representing 20.65 percent of total employment. Within this group, about 1.2 million are gig workers and self-employed individuals.

According to Social Security Organisation (Socso) records, 133,481 workers contribute under the p-hailing sector and 189,450 under the e-hailing sector via the Self-Employment Social Security Act 2017. These figures highlight the growing reliance on gig work across Malaysia and the need for a dedicated protection framework.

Developed through nationwide consultation

The initiative traces back to March 2024, when the Ministry of Human Resources was tasked with designing a comprehensive protection model for gig workers. The ministry collaborated with Universiti Malaya and conducted extensive consultations across federal ministries, Sabah and Sarawak state authorities, and through nearly 40 engagement sessions nationwide. Around 4,000 stakeholders participated, including gig workers, platform companies, trade unions, academics, and civil society organisations.

The draft framework was also presented to an international technical committee focusing on decent work in the platform economy to align Malaysia’s approach with global best practices. Minister Steven Sim emphasised that the bill reflects the voices and experiences gathered from gig economy stakeholders across the country.

What workers and platforms can expect next

• Clear, written contracts that spell out payment timelines, insurance provisions, and termination and suspension procedures.
• Protection from sudden pay rate changes and arbitrary deactivations, with a guaranteed right to be heard.
• Freedom to work across multiple platforms without unfair restrictions.
• Access to a dedicated Tribunal for quick and effective dispute resolution, including reinstatement and compensation where warranted.

For platforms and contracting firms, the law creates a level playing field with defined obligations and accountability, reducing ambiguity and ensuring consistent standards across the sector.

A step toward a fairer digital economy

The Gig Workers Bill 2025 marks a structural shift in how Malaysia treats platform and freelance labour. By recognising gig workers as a distinct category and setting enforceable standards, the law seeks to balance flexibility with fairness—providing income security, due process, and a clear route to redress without eroding the agility that makes gig work attractive.

As implementation begins, the government’s focus will be on ensuring compliance, educating workers and platforms about their rights and obligations, and monitoring outcomes to refine the framework over time. The bill signals a commitment to inclusive growth—one that recognises the critical role gig workers play in Malaysia’s evolving economy and offers them the protections they deserve.