This contribution by bosses is “small” compared to what was proposed and agreed before, Malaysia Trades Union Congress (MTUC) president Halim Mansor said today.
He questioned how MEF came up with the amount.
“RM1 was the amount that we proposed when we asked for the retrenchment fund to be set up 20 years ago.
“A lot of time has passed since then and our salaries are not the same as they used to be.
“How can they now propose RM1?” he asked, adding that the amount was not adequate.
Yesterday, Sin Chew Daily reported that MEF, at a press conference, had suggested that the government, bosses and employees jointly contribute RM1 each for EIS.
The bosses’ group said that with this RM3 joint contribution, EIS will be able to collect a total of RM245 million.
The Chinese daily said MEF president Azman Shah Haron estimated that the average sum of money that was compensated to sacked workers had been RM6.5 million for the past 10 years and the sum of over RM245 million was more than sufficient.
Azman also said when the three parties’ contributions had reached a sufficient amount, the contributions by employers and employees should be stopped and employers should not be burdened by continuing to pay for the EIS scheme until the employees retired.
Meanwhile, MEF executive director Shamsuddin Bardan was reported as saying that 90% of Malaysians who were sacked were already being compensated with only 10% yet to receive their payouts.
He added that the workers’ risk of being laid off is only 0.6% in the country.
The government had on Aug 1 tabled the EIS bill which would benefit thousands of retrenched employees every year.
Under the bill, employers are to contribute to the EIS a minimum rate based on the employee’s monthly wages.
The system, to be managed by the Social Security Organisation (Socso), was expected to come into force on Jan 1, 2018, with payouts starting in 2019.
Under the bill, the EIS was also applicable to those who are not already Socso members.
The scheme covers monthly wages of up to RM4,000, with both the employers’ and employees’ contributions ranging from 10 sen to RM29.65 a month.
MEF had objected to the bill as it said it would burden the employers.
The bill was put on hold after its first reading to allow the government to engage with stakeholders.
Halim said the workers’ rights were not protected as long as the EIS bill did not come into force.
“Parliament should just continue with the second reading and let MPs debate the bill on the rates of contribution and how the government manages it, not listening to the grouses of employers.”
Halim told the employers’ group to be responsible for their workers’ welfare and not merely object to EIS because they have to bear the costs.
Meanwhile, Klang MP Charles Santiago told the government to be transparent on the number of retrenched workers and cost to establish EIS.
“The actual contribution would depend on actuarial projections, depending on the retrenchment numbers, administration costs and operational costs to establish EIS.
“This information is with the government and they need to be transparent,” he said.