PUTRAJAYA: Retrenched workers will be able to get allowances to last them from six months to a year once the proposed Retrenchment Compensation Scheme is finalised.
The scheme, similar to Socso and EPF, will need employees and employers to contribute each month and is supposed to act as a safety net to those retrenched until they are employed elsewhere.
Human Resources Minister Datuk Seri Dr Fong Chan Onn said both the Malaysian Employers Federation (MEF) and the Malaysian Trade Union Congress (MTUC) have agreed in principle to the scheme and it would have to be discussed further before being implemented.
Paving the way for its implementation is the setting up of a special committee headed by ministry secretary-general Datuk Thomas George with MEF and MTUC as members.
“The committee can come up with a series of proposals and amendments to restructure our labour market to make it more competitive,” he told reporters after chairing the National Labour Action Council (NLAC) meeting and before the Ministry’s Hari Raya and Deepavali celebration here on Thursday.
Dr Fong added that the committee was studying how the retrenchment compensation scheme could be introduced through Socso which now does not have the provision for a safety net for retrenched workers.
He said MEF and MTUC members have visited Australia and countries in the United Kingdom to study the safety nets they have introduced for their retrenched employees.
“Their visit is also to study the various changes they have made to their various labour laws to suit the current global challenges while achieving an economic boom,” he said, adding that Malaysia too needed to study its employment laws to allow businesses here to flourish.
He hoped disputes at industrial court and labour department which currently took up to seven years to solve could be completed at least in one year just like cases handled by the arbitration tribunal in Britain.
“We are looking for such a mechanism in Malaysia because cases at industrial courts here can drag up to High Court and so on and takes a long time,” he said, adding that prolonging such cases only affected productivity.
Dr Fong also said the MTUC and MEF would be conducting a series of road shows to promote the productivity-linked wage system (PLWS) to ensure the nation’s workforce was of international standard.
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