PETALING JAYA: Confusion over the implementation of reduced levy for extending the services of foreign workers in five sectors has been cleared, say industry players.
Master Builders Association Malaysia president Foo Chek Lee said the implementation was timely in light of new infrastructure and housing projects.
“Retaining foreign workers with 10 years experience would result in higher productivity.
“It also means that they would be able to train other non-skilled foreign workers and help reduce the need for more foreign workers in the long term,” Foo said in an interview here yesterday.
SME Association of Malaysia president Datuk Michael Kang said the move would stimulate business growth which had been lacking due to the shortage of foreign workers in the manufacturing sector.
“There are business opportunities but the shortage of experienced workers had affected growth. Although there was some delay in gazetting the reduced levy rates, it is timely,” he said.
He claimed that a furniture factory in Sungai Buloh saw its workforce of 500 reduced to 50 recently due to a shortage of experienced foreign workers.
Malaysian Foreign Maid Agency Association president Datuk Foo Yong Hooi said while he was happy that the matter had been resolved, the gazette for the reduced rates was only applicable for a one-year period beginning April 30.
“We hope it can be extended for a three-year period instead of on a year-to-year basis,” he said.
Malaysian National Association of Employment Agencies advisor Datuk Raja Zulkepley Dahalan said there was still a need to rely on foreign workers.
“The implementation of the reduced rates was delayed. It led to confusion among some employers as to how much they needed to pay,” he said.
Last November, the government announced under Budget 2019 that employers would be allowed to extend the services of foreign workers in their employ for more than 10 years for another three years.
However, employers were required to pay a RM10,000 levy for workers in the manufacturing, services and construction sectors and RM3,500 for those in the agriculture and plantation sectors.
Following an outcry from employers, Finance Minister Lim Guan Eng announced in February that the extension fees would be reduced to RM6,000 and RM2,000 respectively.
However, there was confusion among employers as they were still required to pay levies of RM10,000 and RM3,500.
But it was explained on Thursday that the delay in implementation of the lower levy rates was due to legal processes.