Resolving worker shortage woes


AS you’re aware, there is a serious manpower situation that Malaysia is facing. Some are saying Malaysia is at breaking point. It’s feared that our country is missing a golden opportunity to capitalise on high palm oil prices and will suffer production losses because of the acute shortage of workers. What has been done?

According to the Malaysian Palm Oil Board (MPOB) report in 2015, up to 78% of the oil palm plantation workers are foreign workers, with most of them coming from Indonesia.

Due to the Covid-19 pandemic, there was no new arrival of foreign workers beginning from March 2020, and Malaysia recently opened its international borders on April 1, 2022. Due to the shortage of workers in the oil palm plantation sector, expected revenue losses are around RM20bil.

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This has led to the Malaysian Cabinet to agree to a special exemption for the intake of 32,000 foreign workers for the palm oil sector in April 2022.

As mentioned much earlier, since most of the foreign workers are Indonesians for the oil palm plantation sector, the government concluded a specific MOU with Indonesia on the recruitment of domestic workers on April 1, 2022. The conclusion of the said MOU is pertinent to pave the way for the recruitment of Indonesian workers for the formal sectors.

> It was reported in May that the first batch of Indonesian workers ran into problems because of work permit issuance and their arrival was aborted. The problem was due to the workers not getting the right visa. Have these glitches been resolved?

The technical glitch has been resolved and we have started to receive a few batches of Indo-nesian workers starting from May 22, 2022, for various sectors, namely plantation and manufacturing.

We are expecting bigger numbers of Indonesian workers (17,987) within a month or two for the plantation and manufacturing sectors.

> How many workers are coming in now as we speak?

As of June 17, 2022, 19,043 foreign workers have arrived in Malaysia since early this year. We are expecting bigger numbers to arrive within a few months’ time. The number that I shared just now was for earlier approval given by the Home Affairs Ministry.

> Apart from Indonesian workers for plantations and construction, are those from Bangladesh being considered?

We have a working arrangement for the recruitment of foreign workers from 14 source countries to work in sectors that permit hiring foreign workers.

Some foreign workers are suited to working in certain sectors, for example, Indonesian workers are more adaptive to the plantation and construction sectors.

The most important thing is that the MOUs that we have signed with various source countries have clearly outlined sectors of work that are related to their respective nationals.

> What is the Malaysian government’s rationale in capping 25 recruitment agencies out of the 1,000-plus interested agencies from Bangladesh? What were the previous practices and experiences?

Migration is a global and complex issue that must be managed wisely. There are many issues related to migration, including human trafficking. Malaysia is currently placed in an unfavourable position with regards to the annual Trafficking in Persons Report issued by the US State Department.

The report will always consistently highlight the excessive recruitment fees involved for the hiring of workers from Bangla-desh to Malaysia. A classic example is that of a Malaysian government-linked company being requested to refund the Bangla-desh workers the fees they paid in the recruitment process.

In this regard, Malaysia must deal with and address this delicate issue. Hence, limiting the number of recruitment agencies from Bangladesh will support this noble cause. Malaysia fully supports the fair and ethical recruitment practices espoused by the International Labour Organisation (ILO) that there should be a minimum cost borne by the workers.

> Is such a cap on agencies a standard procedure in other countries? Could you provide some examples?

The recent decision to increase the number of recruitment agencies from Bangladesh from 10 to 25 is considered a fair approach. As I mentioned earlier, extra emphasis was given by the US State Department report on recruitment of workers from Bangladesh.

Hence, extra measures must be taken by Malaysia to address this concern, and limiting the number of recruitment agencies is one of the steps taken.

> But why is the cap only for workers from Bangladesh? What is the recruitment process like for workers from other countries?

I must inform you that the recruitment process is equally the same for all source countries.

Our employers must make their application online for the requested quota, and once it is approved by the Human Resources Ministry, employers can make the levy payment to the Immigration Department and, subsequently, make the necessary arrangements to bring in the workers.

The recruitment process is carried out as per the obligations under the bilateral agreement between the source country and the receiving country, which has been extensively negotiated prior to its conclusion.

> Restaurants, especially from the nasi kandar sector, are crying out for Indian workers. What are the problems they are facing?

In my engagement session with the industries, this was made apparent by the restaurants association and owners. I understand the problems that they are facing, but we must take into consideration the size of business as well as the number of branches they have.

If we approve the number of foreign workers that are surplus to their requirement, there is a tendency to supply the workers to other employers that could then lead to exploitation of those workers.

Furthermore, the employers in the restaurant sector also need to demonstrate their ability to provide adequate and decent housing and accommodation, as outlined in the legislation (Act 446) and follow the good example from other sectors, such as the plantation sector.

> On the issue of domestic maids from Indonesia, Malaysian employers have yet to see the availability of the maids although the MOU was signed in April. What are the updates?

The first batch is expected to arrive by the end of this month or early next month. One important thing to highlight is that the conclusion of the said MOU has paved the way for the entry of Indonesian workers for the formal sectors.

> What are the steps being taken to provide alternative source countries besides Indonesia?

The ministry is exploring bilateral arrangements with other source countries such as Cambodia. We are in the midst of finalising the MOU with Cambodia for both domestic and formal sectors. We are also looking into implementing a pilot project of hiring domestic workers from Nepal.

> It is often said that Malay-sians are reluctant to work in certain sectors including even F&B. Yet, Singapore has no issue attracting Malaysians from Johor, especially, to work there. Many Malaysians also go to Dubai to work. Does it boil down to salaries?

The government has introduced minimum wage legislation to create a balanced pay scale between foreign and local workers, as well as to address the discrimination issues therein. Recently, the government increased the minimum wage to RM1,500 for all sectors of work excluding domestic workers, commencing May 1, 2022. One of the chief reasons is to retain the interest of workers to be employed in the formal sector as opposed to the informal sector, such as the gig economy.

As I have said many times, it is no longer an employers’ market but employees’ market. During the Covid-19 pandemic, many have delved into the gig economy, whereby the effect may be severe on the formal sector because the employees can dictate their working hours and preferred hours of work. As such, the minimum wage is one of the ways to sustain the level of formal employment in the country.

> While we are reliant on foreign workers because oil palm plantations are human capital intensive, we have also been criticised for our dependence on low skilled foreign workers. Malaysia is exporting high skilled workers to Singapore and other countries. What are your views on this?

It is a neverending cycle when it comes to labour migration and skills mobility. Which is why the Ministry of Human Resources is emphasising reskilling and upskilling to ensure that our workers are equipped with adequate skills to sustain their livelihoods.

Even developed countries such as the US and the UK are still reliant on foreign workers for their low skill sectors. That is why Talent Corporation has come up with the Critical Occupation List (COL) to determine sectors of work that are critical in which Malaysian talents are still lacking.

> Are Malaysians over-reliant on foreign workers? Should there be greater investment and commitment to automation?

We fully support automation, but it requires investment and will not happen overnight. The government must provide incentives to the industry to spur the effort for automation.

Our TVET (technical and vocational education training) institutions must also revise their syllabus and training methods to be in line with the evolution of Industrial Revolution 4.0. Our dependency on foreign workers will continue but could be confined only to the 3D sectors.

> Finally, what would you say to Malaysia on the key salient points our country has taken to protect the workers?

To ensure workers’ protection, the government has taken various initiatives.

At the international level, the ministry has ratified ILO Protocol 29 on Forced Labour and joined the global network of Alliance 8.7 – both of which are to address the forced labour issue commonly associated with migrant workers.

At the domestic level, the National Action Plan on Forced Labour was launched and implemented, along with strengthening enforcement on various labour legislations.

The most important thing that I wish to highlight is the Working for Workers (WFW) mobile application where workers can file complaints on 17 types of complaints without having to be present at the Department of Labour offices. The complaints include unpaid wages, overtime, housing and working conditions, and others.

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