Associations want levy repealed

Datuk Shamsuddin Bardan

KUALA LUMPUR: The move to force employers to pay the annual levy of foreign workers is not sitting well with industry players.

Representatives of 159 associations met yesterday to rally for the decision to be rescinded.

Malaysian Employers Federation (MEF) executive director Datuk Shamsuddin Bardan, who was one of the organisers of the meeting, estimated that the move would cost industries an additional RM5bil a year.

“We don’t agree with the change as the impact cost is very serious. Industries will be tied down by the additional cost and their working capital will reduce. This will have a negative impact on our local economy,” he said.

Shamsuddin added that their concerns would be submitted to Prime Minister Datuk Seri Najib Tun Razak in a letter, as well as to relevant agencies and ministries.

Last Saturday, Deputy Prime Minister Datuk Seri Dr Ahmad Zahid Hamidi announced that employers would now be responsible for paying the levy of their foreign workers – ranging from RM1,500 to RM2,500 depending on the industry – instead of deducting the fee from the workers’ wages.

The new policy, enforced under the Employer Mandatory Commitment, also requires employers to make sure that the foreign workers they hire do not run away, change the sector of work illegally or overstay and become illegal immigrants.

The announcement came as a surprise as it was made just one day before it was set to be implemented on Jan 1.

Malaysian Association of Hotel Owners executive director Shaharuddin M Saaid expressed his frustration that industry players were not consulted before the move was put in place.

“It came as a big shock to us on New Year’s Day.

“There should be two-way communication between the Government and industries,” he said.

Federation of Malaysian Foundry and Engineering Industries Association president Tan Poh Seng urged the Government to hear the views of affected industries before introducing any policy.

He claimed that the move would reduce the competitiveness of businesses.

“We are already facing an uncertain economy and a weakened ringgit. Such a move will only increase our burden and encourage industries to shift their operations to other markets that are more business-friendly, such as Vietnam,” Tan said.

Malaysian Textile Manufacturers Association president Datuk Seri Tan Thian Poh said the move would not encourage a decline of illegal foreign workers in the country.

“When you make it costly to hire legal workers, it will only encourage the employment of illegal foreign workers. In the end, the increased cost will be passed down to consumers. They are the ones who are eventually going to pay for it,” he said.