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Malaysia employers to pay for levy

Malaysian employers will now pay levy of foreign workers



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Employers in Malaysia will now be responsible for the levy of foreign workers under the newly-introduced Employer Mandatory Commitment (EMC), according to Bernama.

Deputy prime minister Datuk Seri Dr Ahmad Zahid Hamidi, also the home minister, commented in the report that the EMC was to ensure that employers were fully responsible for their workers from the time of their appointment to the time they returned to their countries.

Additionally, he also said in a statement that this change in policy would ensure that employers were more responsible in taking care of their workers and avoid cases of foreign workers running way, changing sectors of work illegally, and overstaying and becoming illegal immigrants.

Hamidi also highlighted how recruitment of foreign workers was “a privilege granted to employers to meet the manpower needs of industries and help national economic growth”.

However, he said, there were employers who were not responsible for the workers they brought in and violated the provisions in the law and regulations.

“There were instances where foreign workers ran away and the employers washed their hands off the matter and left it to the Immigration Department, police and other agencies to locate and send back the workers,” he said.

Such incidents gave room to irresponsible people to indulge in human trafficking,” he added.

In response, Malaysian Employers Federation (MEF) executive director Datuk Shamsuddin Bardan had voiced out in the New Straits Times that the new requirement, which took effect on 1 Jan 2017, might cause employers to experience huge losses. In fact, the report stated that as much as RM5 billion could be drained from the country’s economy annually if employers are required to pay the levy for hiring foreign workers.

“Foreign workers, on the other hand, will now be able to remit this RM5 billion elsewhere, including their countries of origin,” he added.

With the economy “already losing RM3 billion a year” due to the implementation of minimum wages for foreign workers, he concluded: “Clearly, the country’s economy will face huge a downturn because of this move.”

Photo / 123RF



Uncover and learn about complex HR innovation tools and strategies at Accelerate HR from Thailand's largest employers including Agoda, DKSH, Fonterra, FWD, Kasikornbank, Minor Food, Nissan Motor and more.
Happening in Bangkok on 26-27 November, group discounts when you bring your team.

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