Malaysia's Gig Workers Bill: A milestone for recognition or a new tax for riders?

SHAH ALAM - If the voices of gig workers are anything to go by, Malaysia’s first-ever law for the sector is a story of good news and not-so-good news.

After years of operating in a grey area without a dedicated legal framework, the country’s 1.2 million gig workers from e-hailing drivers and delivery riders to freelancers and part-timers are finally seeing a bill that recognises their work.

The Gig Workers Bill 2025, tabled in Parliament yesterday for its first reading, aims to set out clear rules for service agreements, strengthen payment practice and provide formal avenues for dispute resolution.

But not everyone is happy. While some groups hailed the bill as a long-awaited breakthrough, others warned that it could end up doing more harm than good.

What the Bill Proposes

Human Resources Minister Steven Sim said the bill has four key pillars:

• A legal definition of gig workers.
• A dispute resolution system, including a dedicated tribunal.
• Provisions on payment rates and timely remuneration.
• Access to social security schemes.

The draft law also requires contracting platforms to provide workers with clear service agreements upfront, including details on rates and terms.

It introduces a Consultative Council to recommend standards and allows workers to take disputes to a tribunal.

The ministry said the bill was shaped after 40 engagement sessions with nearly 4,000 stakeholders, plus 500 online feedback submissions.

Supporters of the bill see it as a milestone. The Malaysian eHailing Association (GEM) welcomed the move, calling it a reform shift that elevates the dignity of gig workers, while the Professional Film Workers Association of Malaysia praised it for providing fairer legal recourse and safeguarding welfare.

To them, the bill is not just about regulation, but about recognition of gig work as a legitimate and valued part of the economy.

Yet, beneath the optimism lies unease. Several associations representing delivery riders and drivers say the law in its current form risks punishing workers rather than protecting them.

The Pushback: A betrayal of workers

The Persatuan Penghantar P-Hailing Malaysia (Penghantar) expressed particular concern that lumping all gig workers under a single framework ignores the very different challenges they face.

For riders, the main issue is not simply legal recognition but low fares, shrinking margins and long waits for jobs.

Much of the anger stems from the bill’s provisions on mandatory Perkeso deductions, which critics argue will eat into already modest incomes.

P-hailing riders, for example, say they often earn as little as RM5 to RM10 per delivery and must complete over a hundred jobs a month just to meet basic costs. For them, mandatory contributions feel less like social protection and more like a new tax.

The bill also introduces a dispute resolution tribunal, but workers point out that they cannot be represented by lawyers, only by family or associations, which they say limits their access to justice.

International examples are often raised in these debates. Spain’s 'Rider Law,' which led Deliveroo to exit the country and India’s Rajasthan gig law, which many claim weakened small startups, are cited as cautionary tales of how overregulation could harm the very workers it seeks to protect.

Critics worry that Malaysia may be heading down the same path, potentially strengthening big platforms while pushing smaller ones out of the market.

Penghantar president Zulhelmi Mansor has urged the government to delay the law and conduct a Regulatory Impact Assessment before it proceeds. His group insists that issues such as wage clarity, fairer fares and prompt payment must be resolved first.

Without these, they argue, the law risks being cosmetic, offering the appearance of protection while leaving fundamental problems unaddressed.

"We urge Members of Parliament to carefully review this Bill as it will destroy gig workers.

"We question who exactly sits in the Working Committee that drafted the Gig Workers Bill," he said in a statement.

The debate matters because gig work is now an essential part of Malaysia’s economy.

Flexible but insecure, it sustains hundreds of thousands of Malaysians who rely on it for daily income.

The Gig Workers Bill represents the first serious attempt to strike a balance between flexibility and protection, but as the sharply divided reactions show, that balance is far from easy to achieve.

The bill is scheduled for its second and third readings in the current parliamentary session.

As lawmakers deliberate, the question remains whether this law will truly safeguard workers’ welfare or end up tightening the very squeeze many of them already feel on the ground.