president message september 2022

SEPTEMBER 2022 PRESIDENT’S MESSAGE

 

GOVERNMENT DEFERS IMPLEMENTATION OF EMPLOYMENT ACT 1995 AMENDMENTS

MBAM commends the Government’s decision to delay the implementation of Employment Act Amendments which was expected to be enforced starting from September 1. The Ministry of Human Resources has decided to defer the implementation of the Employment Act 1995 Amendments to the 1st of January 2023 which will provide more time for contractors to prepare for the changes being enforced through the Employment Act.

This comes as a relieve for the construction industry which was foreseen to struggle accommodating to the additional costs incurred from the amendments of Employment Act 1995 as such costs have not been budgeted by contractors. The construction industry continues to deal with uncertain liabilities resulting from the COVID-19 pandemic and requires extensive time to fully recover their businesses. Despite operating at full force during the country’s transition to an endemic phase, manpower challenges have hampered the industry’s recovery process. The construction industry is dealing with a severe shortage of workers where all jobs are already delayed in progress.

The amendments include flexible working arrangements (FWA) with limited guidelines, increase in overtime costs for employees with wages up to RM4000 per month, reduction of working hours from 48 hours to 45 hours, 60 days of hospitalisation leave per year in addition to non-hospitalisation sick leave, increase in maternity leave from 60 days to 98 days and paternity leave of seven continuous days per birth. On top of the lack of a proper economic recovery plan post pandemic, the effects of the new minimum wage of RM 1500 will also be detrimental to the industry as additional costs. In light of this, the government should also look into a proper economic recovery plan for the industry in order to boost the economy.

 

HRD CORP LEVY CONTRIBUTION

MBAM continues to appeal to the government to revisit the mandatory levy payment to HRD Corp which was enforced from 1 January 2022. Employers that have more than 10 Malaysian workers are required to register for HRDF and pay a 1% levy for each worker’s monthly salary (which includes basic salary and fixed allowance). Although we understand the need to address the increase in cost of living brought about by the pandemic and disruptions in global supply chain, contractors are also facing the increase of cost of doing business due to the levy payment.

On a different note, I would also like to take this opportunity to wish “Selamat Hari Malaysia” to all our members. Travel safe during the long weekend and take care!

 

Oliver HC Wee
MBAM President

error: Content is protected !!
copyright protected