HRDF expands coverage to train more employees

KUCHING: The Human Resources Development Fund ( HRDF) is expanding the coverage of the Pembangunan Sumber Manusia Berhad Act 2001 ( PSMB Act 2001), with effect from April 1, by streamlining its eligibility criteria to Malaysian employers across all sub-sectors within the manufacturing, services, mining and quarrying sectors that employ a minimum of 10 local employees.

In addition, the amendment to the PSMB Act 2001 also includes the expansion and increase of coverage for ‘Category Options’ for employers across all subsectors under the manufacturing, services, mining and quarrying sectors with five to nine local employees, and the abolishment of the paid-up capital criterion for the manufacturing and mining and quarrying sectors.

HRDF, in a statement, said it was given the mandate by the government to improve its regulatory and funding support by way of broadening access to its HRD Fund by expanding the coverage of the said Act.

This expansion is expected to increase the number of employees who are eligible for training under HRDF from the current 1.77 million to 2.8 million by 2020 – an increment of 58 per cent.

“The expansion of the PSMB Act 2001 is a step towards qualifying and quantifying training and development programmes that are not only able to improve core competencies of employees of HRDF-registered employers, but also would help towards enhancing their (employees’) overall business sense.

“This expansion is also a crucial step towards the overall development of Malaysia’s human capital; assisting in increasing the number of skilled local workers from the current 31 per cent to 35 per cent by 2020 (as outlined under the 11th Malaysia Plan 2016-2020),” it said.

The HRDF noted that Human Resources Minister Datuk Seri Richard Riot, in accordance with Section 19 of the PSMB Act, 2001, had agreed to provide a registration grace period of six months, effective April 1 and runs till Sept 30, to employers subject to the Act.

“Employers who are subject to the PSMB Act 2001 are required to register with HRDF within the mentioned grace period and in such manner as stipulated under subsection 13(1) of the PSMB Act 2001.”

In this instance, HRDF pointed out that it was the duty of the eligible employers to pay HRD levy on each of its local employees at the rate of one per cent of their total monthly wages.

“These employers must pay the respective levy from the date of liability under Regulation 7 of these Regulations Human Resources Development Board (Registration of Employers and Payment of Levy) Regulations 2001, which states: ‘An employer who is liable to pay the levy in respect of each employee shall pay those levies for the first and subsequent month’s wages commencing from the date the employer becomes liable’.”

HRDF also stated that the effective date of the expansion of the PSMB Act 2001 coverage, affecting the coordination number of local employees to 10 persons, is for the following sub-sectors – namely all those within the manufacturing sector; all within the mining and quarrying sector; and below sub- sectors within the services sector such as food and beverage, hypermarkets, supermarkets and department stores.

“Thus, employers who are affected by the expansion of the PSMB Act 2001 beginning April 1 must submit their respective Employer Registration Form (Form 1) no later than 30 days from the mentioned date.

“However, with the implementation of the registration grace period, employers are given the flexibility to register their company over a period of six months (April 1 to Sept 30) without being charged any levy arrears and/or interest.”

Employers covered by the PSMB Act 2001 are required to complete the Employer Registration Form (Form 1) and Employer Information Form (Form 1A).

These forms can also be downloaded via HRDF’s official website www.hrdf.com.my, where more information can also be found. Alternatively, call HRDF on toll-free line 1800- 88- 4800 to know more.