Minister: 20pc deduction of foreign workers’ salary proposal, further study needed

Human Resource Minister M. Kulasegaran said the suggested deduction is aimed at providing the foreign workers some form of safety net when they decide to return home to the native countries. ― Picture by Azinuddin Ghazali
Human Resource Minister M. Kulasegaran said the suggested deduction is aimed at providing the foreign workers some form of safety net when they decide to return home to the native countries. ― Picture by Azinuddin Ghazali

KUALA LUMPUR, Dec 16 — The Ministry of Human Resource has clarified the move to deduct 20 per cent deduction from foreign workers’ salaries was just a suggestion to guarantee some form of financial security for the workers.

Human Resource Minister M. Kulasegaran, after chairing the National Labour Advisory Council (NLAC) meeting today, said the suggested deduction is aimed at providing the foreign workers some form of safety net when they decide to return home to the native countries.

“It is a suggestion where we are looking at it as a win-win situation, as most of these workers are among the B40 group or lower, and we want to ensure they have something to take back,” he said during a press conference in parliament this afternoon.

Kulasegaran explained the suggested deduction still needed the approval from the technical committees within his ministry, and then the usual process of it needing the approval of the cabinet and then Parliament.

“It is a form of forced savings for the employee, and also a check and balance system for employers, as we are able to see whether or not they make their contributions in real time,” he said, saying the contributions would be put under the purview of the Social Security Organisations (Socso).

This comes after Kulasegaran revealed the suggestion yesterday, saying among the reasons for its implementation was so that foreign workers do not flee, while avoiding employers from incurring losses in investments bringing in the workers.

He had said that the issue of foreign workers fleeing was among major problems faced by the employers, and the proposal was seen as relevant method in addressing the situation.

Kulasegaran today added mechanisms behind the suggested move would be looked at closely by the committee, who will report their findings to the ministry on January 29 next year.

“It will be looked at holistically,” he replied when asked if the move would also effect expatriates hired locally.

“We have to start somewhere to do something for these foreign workers, as I feel they are among the more vulnerable groups who requires protection,” he said.