EPF Term Definations


An employer is defined as a person(s) with whom an employee has a contract of service or apprenticeship.

Employer includes:

  • Manager, agent or person responsible for the payment of wages to an ’employee’
  • Any group of persons whether statutory or non-statutory or incorporated
  • Any Government, Government Department, Statutory Body, Local Authority or other bodies as specified in the Second Schedule to the EPF Act 1991


An employee is defined as a person who is employed under a contract of service or apprenticeship. The contract of service or apprenticeship can be written or oral, expressed or implied.


All remuneration in money due to an employee under his contract of service or apprenticeship whether it was agreed to be paid monthly, weekly, daily or otherwise.

Among the payments that are liable for EPF contribution:

  • Salary
  • Payment for unutilised annual or medical leave
  • Bonus
  • Allowance
  • Commission
  • Incentive
  • Arrears of wages
  • Wages for maternity leave
  • Wages for study leave
  • Wages for half day leave
  • Other payments under services contract or otherwise

Among the payments not liable for EPF contribution:

  • Service charges (a service fee, a tip or otherwise has been paid by, charged on, collected from or voluntarily given by a customer or any other person not being the employer in relation to the employer’s business and which is payable to an employee)
  • Overtime payment (includes payment for work done on public holidays and rest days)
  • Gratuity
  • Retirement benefits
  • Retrenchment, temporary and lay-off termination benefits
  • Any travelling allowance or the value of any travelling concession
  • Payment in lieu of notice of termination of employment
  • Director’s fee

Transfer of retirement benefits

An employer may, with the approval of an employee, transfer to the employee’s EPF account any funds being the retirement benefits of the employee or any funds from any other retirement scheme or plan relating to the employee. Such a transfer can be made through Form EPF 16F.