Malaysian business licence·Federal
Incentive Payment Scheme Approval Permit (IPSP)
Issued by Jabatan Tenaga Kerja Semenanjung MalaysiaEmployment Act 1955
Overview
The Incentive Payment Scheme Approval Permit (IPSP) allows employers to issue specific allowance payments that are excluded from the calculation of regular wages. This permit is essential for businesses looking to enhance productivity and employee income through incentive payments.
Key details
Governing Act
Employment Act 1955
Agency fees
No fees and no validity period until revoked.
Validity
Annual renewal typical
Issuing authority
Jabatan Tenaga Kerja Semenanjung Malaysia
Fees shown are government / local-authority fees payable to the issuing agency. Emerhub charges a separate service fee for handling the application end-to-end.
Eligible applicants
Businesses, companies, limited liability partnerships & professional bodies
Application requirements
- Implementation after discussion and agreement with involved employees.
- Existing incentive payments must not be included in the calculation of 'regular wage' for statutory benefits.
- Must benefit employers by increasing productivity.
- Must benefit employees by increasing income.
- Implementation must not affect existing employee benefits.
- Incentive payments must not exceed 10% of the employee's basic wage.
- Employees must be informed that incentive payments are not included in the calculation of 'regular wage' for statutory benefits.