KUALA LUMPUR: The proposal to introduce a direct hiring system for foreign workers will address long-standing challenges faced by labour-intensive industries, says the Malaysian Associated Indian Chambers of Commerce and Industry (MAICCI).
In a statement on Thursday (Feb 5), its president Datuk Seri N. Gobalakrishnan welcomed the announcement by Human Resources Minister Datuk Seri R. Ramanan to introduce a direct hiring system for foreign workers.
"Sectors such as construction, renovation, food services, catering and hospitality continue to face mounting pressures.
"This is due to the proliferation of illegal manpower operators, especially agents who impose exorbitant fees on foreign worker applications even before workers arrive in Malaysia.
"While Malaysia aspires to build a resilient and future-ready economy, the reality faced by employers on the ground is far more fragile.
"Many businesses are operating within a recruitment ecosystem that is volatile, costly and increasingly unsustainable," he said.
ALSO READ: Direct hiring system for foreign workers in the works
Gobalakrishnan added that access to a reliable, transparent and lawful foreign workforce is no longer just an operational concern for employers in labour-intensive sectors, but a systemic challenge.
"It directly affects project quality, delivery timelines and overall business sustainability," he said.
MAICCI Women’s Wing chief S. Hemala highlighted that employers incur substantial upfront costs for each foreign worker, including levies, airfare, medical examinations and administrative fees.
"These investments are frequently jeopardised when workers abscond or are poached by illegal subcontractors offering marginally higher daily wages.
"High recruitment fees and hidden charges inflate operating costs, while many workers arrive in Malaysia already burdened by recruitment-related debts incurred in their home countries.
"These challenges are compounded by frequent changes in government quotas, sudden freezes and reopenings of hiring windows, as well as revisions to levy structures.
"This makes long-term manpower planning extremely difficult for businesses," she said.
Hemala said the group welcomes the proposed direct hiring initiative as a constructive step towards addressing these long-standing issues.
"The removal of unnecessary intermediaries would help reduce recruitment costs, minimise delays and enhance transparency.
"A direct hiring mechanism has the potential to benefit both employers and foreign workers.
"For businesses, it offers a more predictable, efficient and compliant recruitment process.
"For workers, it ensures clearer accountability, reduced exploitation and stronger protection of their rights," she said.
Hemala called for a transparent, structured and digitally-enabled direct hiring framework with strong enforcement to protect against illegal operators.
"This will promote sustainable business growth, safeguard worker welfare and strengthen Malaysia’s overall labour ecosystem," she added.
On Wednesday (Feb 4), Ramanan said the government was drawing up a pathway to allow employers to hire foreign workers directly as part of an effort to eliminate third-party agents or middlemen from the recruitment process.
