Legal foreign workers need to come in fast to avoid business disruptions

IPOH, July 10 — The government should speed up the process of bringing in legal foreign workers in order to avoid disruption to businesses following the ongoing mass crackdown on illegal foreign workers, said Malaysian Employers Federation executive director Shamsuddin Bardan.

“Of course, the government has every right to enforce the law on illegal workers because they don’t have any business to be here in the first place.

“However, when they shut out these workers, they should be quickly replaced with legal ones,” he told Malay Mail when contacted.

“But the problem now is the legal ones are not coming because of strict procedures and the change in the mechanism of hiring foreign workers,” he added.

Thus, Shamsuddin said this will result in employers closing down their businesses or suspending their operations for a period of time.

Shamsuddin pointed out that most of the foreign illegal workers are hired by micro enterprises and that they (employers) may not have a full business licence.

“The number of micro enterprises is huge. We have about 680,000 registered companies and out of that number, 73 per cent are micro enterprises.

“We have to understand that these micro employers may not have a full business licence, in the sense that they possibly don’t have the proper premises to run a business,” he said.

“If you want to legalise your illegal foreign workers and you don’t have proper accommodation, then no way can you register them. This is the reality that employers are facing right now.

“When the deadline on the legalisation expired recently, out of 800,000 foreign workers who were registered, only 300,000 were legalised. With that, there is still a big number of illegal foreign workers out there,” said Shamsuddin. 

However, Shamsuddin said that hiring legal foreign workers is only a short-term solution but for the future, he said that employers should resort to hiring local workers.

“It is not advisable for the country to depend on foreign workers. Employers must try to attract locals by rebranding the jobs and offering better salaries.

“Employers would not mind paying a higher salary, but the workers must be skilful and more productive,” he said. 

Meanwhile, Malaysian International Chamber of Commerce and Industry Perak branch chairman Datuk Lim Si Boon said employers are heavily dependent on foreign workers and the enforcement will have a significant impact on the business operations should it continue.

“As a chamber, we do not condone activities that breach the law. It is illegal to employ workers without permits and there are rules that the employers must adhere to.

“But cracking down on illegal workers will certainly have an impact on businesses as we are heavily dependent on them,” he said.

“The construction and farming sectors came to a standstill several years ago during a similar crackdown,” added Lim, who is a property developer.

Lim also said if the process of hiring foreign workers is further restricted without the allocation of enough time to adjust to more stringent rules, then there will be an impact on output and ultimately, the cost of business.

“Malaysia is at full employment... if the government enforces the rules on limiting foreign worker supply, increasing the minimum wage and more compliance cost... that will be almost like a ‘perfect storm’ for higher business cost,” he said.

When asked how hard it would be for employers to find new workers who have the right skillset for their companies, Lim said that if it was easy, employers would not have become dependent on foreign workers in the first place.

“It will take a lot for consumers and businesses to adjust to a lower dependency to foreign workers, and I believe this is inevitable,” he said.