Insurance cover for 6.5 million workers

THE Employment Insurance System Bill (EIS), which seeks to better protect some 6.5 million workers, has been tabled in Parliament.

Once passed, it will see the creation of an insurance scheme for workers who are laid off, and look to increase their re-employability.

The Bill was tabled by Human Resources Minister Datuk Seri Richard Riot who told the House that the Government hoped to debate and pass it during the current Dewan Rakyat meeting, which will go on until Aug 10.

The EIS will be administered by the Social Security Organisation.

Employers will be required to not only register their businesses but also all their workers under the system.

Failure to do so could see the errant employers slapped with a fine of up to RM10,000 or a jail term of up to two years, or both, on conviction.

Contributions to the Employment Insurance Fund are calculated based on the person’s salary. The employee will pay half the contribution while the balance comes from the employer.

The contributions are based on fixed rates ranging from the lowest at 20 sen for those earning RM30 a month to RM59.30 for those whose monthly wages are RM4,000 and above.

The insurance scheme covers staff involved in a voluntary or mandatory separation scheme, or those made redundant due to business restructuring or closure.

Employees who have lost their jobs may be able to claim a portion of the insured salary for a period of between three and six months of being unemployed.

The EIS, under Socso, is expected to come into force on Jan 1 next year, with payouts starting from 2019.