MTUC: Decision on RM10,000 levy big relief for migrant workers

Bernama pic.

PETALING JAYA: The Malaysian Trades Union Congress (MTUC) has welcomed the finance ministry’s decision to retract its earlier statement on the levy for migrant workers to be split 80-20 between workers and employers.

MTUC secretary-general J Solomon said the decision to now compel employers to pay the full amount had brought relief to thousands of migrant workers.

He said the decision complied with the ILO Convention 97 and Observations of the Committee of Experts on Applications of Conventions and Recommendations (CEACR), in relation to equal treatment, minimum wage and foreign workers’ levy at the 2018 International Labour Conference.

“We welcome the decision for employers to bear the whole levy. It is definitely a relief for the foreign workers,” he told FMT.

The government had back-pedalled on its decision that the RM10,000 levy for foreign workers be split 80-20 between workers and employees, saying employers would pay the entire amount as was originally the case.

Finance Minister Lim Guan Eng said this was in view of a report in the Sin Chew Daily, where employers said foreign workers would not be able to pay 80% of the levy.

“We gave this leniency to help the employers, but the Sin Chew report made it seem as if the levy was increased, which was not the case,” he added.

Employers who want foreign workers to extend their stay beyond 10 years must now decide whether to pay the RM10,000 levy or send them back and reemploy them as new workers.

It was previously reported that foreign workers who hold temporary foreign worker permits and have been employed for 10 years can extend their employment duration for a maximum of three years.

Solomon said in the first place, the government had allowed the extension to retain migrant workers for the benefit of employers.

“The necessity of extension would not arise if the employers had the foresight to train or retrain Malaysian workers in the best interests of the nation.

“In this context, any concession on the levy or tax exemption sought by the employers should not be entertained. This cannot be justified and can only be construed as an attempt to loot the government’s coffers,” he said.

Solomon said employers should have long-term strategic planning, especially in training local workers so that they are not continuously dependent on cheap migrant workers.

He noted that the continuous dependence on migrant workers, without any intention to upskill local workers, would be construed as employers making the country a place for cheap labour, contrary to the aspirations of Malaysians to make Malaysia a high-income nation.

“The government alone cannot achieve this vision when we allow employers to only focus on corporate greed.

“Accordingly, while appreciating the government’s decision to impose the full levy on employers, MTUC seeks the withdrawal of all tax concessions granted on the levy in order to discourage cheap labour.

“We must protect the integrity of Malaysia, while opening up job opportunities for local workers at reasonable living wages,” he added.