Construction industry players in Malaysia are of a view that the Employer Mandatory Commitment (EMC) does not benefit the country and hence it should be scrapped. Beginning Jan 1, employers are fully accountable for the foreign workers they hire and can no longer deduct their foreign workers’ levies from their salaries.

The shift of foreign workers’ levy payment to employers under the EMC would not benefit the country as the money would flow out of Malaysia, however its sudden implementation would impact the economy.

Foo Chek Lee, president of Master Builders Association Malaysia (MBAM) said the foreign workers would repatriate the windfall to the source countries, as employers would no longer be able to deduct their salaries for the levy payment. This amount can be utilised by local industries to adopt new technologies and mechanisation that will increase productivity.

While modernisation can reduce dependency on foreign workers to slowly phase them out, the policy change can cause financial loss to the tune of RM2 billion per year, as far as contractors are concerned.

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“This will impact us greatly, especially when the levy was just increased from RM1,200 to RM1,850 less than a year ago besides the increase in minimum wage.”

Instead of discouraging job-hopping, EMC would encourage foreign workers to abscond and go to other places with better pay, as there was nothing now for employers to hold them back.

“If the Government does not delay the decision (on EMC), the current account of the country will deficit further,” MBAM vice-president Tan Sri Sufri Mohd Zain was quoted by The Star. The construction industry in the country needs some 1.2 million foreign workers, while the estimated number of foreign workers is around 900,000.

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