The foreign worker dilemma
KUCHING: As the sun peeks up above the horizon, a trail of reflective vests and white hardhats are seen trudging along a muddy path leading to a sprawling construction site.
The massive unfinished structure towering above the residential houses nearby seems to have appeared overnight as only a few short months ago the land was barren.
The ones responsible for this rapid progress are the owners of the worn safety gear, a band of weary foreign workers who have worked tirelessly over the past few months from dawn to dusk to meet the construction deadlines, fuelled only by nicotine and cheap hawker food.
As the workers arrive to their workplace, without a word, they head on to their allocated areas and picked up where they left off yesterday.
They work diligently, efficiently and independently with an ethic cultivated over the years from their extensive experience in laboured work, fuelled by dreams of a better life back home in their countries.
Such a scenario is common at any construction site around the country. Foreign workers make up a crucial component to the backbone of a construction site’s operation, palm oil field or even a factory.
Being a cheaper and more reliable or stable source of labour compared to locals, there is little wonder as to why many industries continue to rely heavily on foreign unskilled work.
New levy policy
However, there seems to be a turnabout on government sentiment for foreign workers as a surprise announcement late last year by Deputy Prime Minister Datuk Seri Ahmad Zahid Hamidi indicated that some significant changes would occur to Malaysia’s foreign worker levy.
The announced changes were made just two days before its effective date of January 1 and included a new policy called the Employment Mandatory Commitment (EMC) policy which would make employers responsible for bearing the cost of the foreign worker levy rather than the foreign workers themselves.
Zahid in a statement said the aim of this change in policy is to ensure that employers were more responsible in taking care of their workers in order to minimise cases of foreign workers running away, changing sectors of work illegally, and overstaying and becoming illegal immigrants.
“The existing rate was too low and ineffective as a preventive measure to ensure that employers sent back their foreign workers to their countries of origin upon termination of their contracts,” he said.
While the aim is to minimise occurrences of illegal foreign workers, industry observers opined that the change would also make Malaysia a more attractive destination for foreign labour due to this shift in cost.
National discontent
Unsurprisingly, the announcement incited outrage across the nation as possible implications of the change include a purported excess of RM5 million to be drained from the Malaysian economy alongside drastic cost increases in many industries.
Prominent figures within the manufacturing, construction and agriculture sectors – industries with the most dependence on foreign labour – spoke out against the change imploring the government to rescind its decision.
In a statement to the media, Datuk Soh Thian Lai, president of the Malaysian Iron and Steel Federation ( MISIF) not only requested a rescindment of the new policy but also called on the government to conduct a stakeholders’ consultation process to come to negotiate a better alternative to the new policy.
“While we appreciate the Government’s objective to minimise the issue of illegal foreign workers, nevertheless this monumental task requires shared responsibility and collective effort of all stakeholders and certainly not the employers alone,” he said.
He continued on to cite main issues with the new policy being that it would contribute to an increase in overall operating costs which would pose additional financial pressure on employers as well as the overall competitiveness of industry players.
Malaysian Employers Federation executive director Datuk Shamsuddin Bardan said companies generally agreed that reliance on foreign workers has to be reduced, although employers needed time to get used to the EMC.
“We can hardly absorb the new costs because of the challenging economic situation. The one-year time frame given can be utilised fully to re-look how we manage foreign workers and for the Government to revamp the recruitment system,” he said.
The concerns raised seems to have been heeded as barely two weeks after the initial announcement, the changes to the foreign worker levy was postponed to 2018 after a cabinet meeting.
Sanjay Modi, managing director of Monster.com, APAC & Middle East opined that this is a correct move as the deferment shows an effort by the government to assist industries in challenging times.
However, as the changes have only been deferred and not rescinded, industry players will still need to start preparing themselves for the upcoming changes and additional government help may be needed.
“While we appreciate the Government’s objective to minimise the issue of illegal foreign workers, nevertheless this monumental task requires shared responsibility and collective effort of all stakeholders and certainly not the employers alone.” Datuk Soh Thian Lai, MISIF president