PETALING JAYA: Setting the employers’ EPF contribution rate at 2% instead of the previously proposed 12% offers immediate relief to businesses and aids economic recovery, says the Malaysian Employers Federation.
Its president, Datuk Dr Syed Hussain Syed Husman, expressed support for the government's decision to cap the employers’ EPF contribution rate for foreign workers at 2%, acknowledging its impact on operational costs.
He stated that the move provides substantial financial relief for businesses, reducing employer costs by at least 10%, especially for MSMEs struggling with cash flow issues due to economic challenges.
"This measure will help businesses retain talent and avoid downsizing. It is the best option available for now," he said in a statement on Monday (Feb 3).
He noted that the 2% rate addresses immediate economic challenges, particularly in light of the government's increase of the minimum monthly wage from RM1,500 to RM1,700.
"It is challenging for many employers who hire foreign workers to manage the RM200 wage increase while also paying EPF contributions for them.
"Future increases in EPF contributions may be considered after thorough studies and stakeholder consultations," he added.
