Malaysia industries in shock as govt threatens to impose stiff fines on poor migrant lodgings

Top Glove workers wait in line to be tested for Covid-19 outside a hostel in Klang, Malaysia, on Nov 18, 2020. PHOTO: REUTERS

PETALING JAYA (THE STAR/ASIA NEWS NETWORK) - The Malaysian authorities' sudden decision to impose a hefty RM50,000 (S$16,400) fine on employers for each foreign worker found staying in an overcrowded lodging unit has caused shockwaves among industry players.

Federation of Malaysia Manufacturers (FMM) said the Human Resources Ministry had already given them the deadline of March next year to comply with Act 446 on the Employees' Minimum Standards of Housing, Accommodations and Amenities.

It was therefore a shock when Senior Minister Ismail Sabri Yaakob announced that the penalty would be imposed from Thursday (Nov 26), in a move to reduce the risk of Covid-19 transmission among foreign workers housed in overcrowded housing.

"Employers are making the necessary adjustments, and are in the process of carrying out the necessary changes to comply with the regulations," said FMM president Tan Sri Soh Thian Lai.

"This sudden change of policy (to take punitive action) appears to show lack of communication among government agencies."

He said employers needed time to make the necessary changes, including for renovation and application for a permit to convert non-residential spaces to dwelling enclaves.

Shocked by apparent widespread Covid-19 infections among thousands of migrant workers at Top Glove's Selangor factories and dormitories, Datuk Seri Ismail said the government will impose the stiff fine per worker from Thursday unless employers provide improved lodgings including those that allow for social distancing.

He also said that the government will conduct Covid-19 tests on 1.7 million foreign workers in the country. There are some two million registered foreign workers in Malaysia and another two million undocumented foreign migrants.

Employers generally do not provide housing for the legal migrant workers unless they work in factories or at construction sites.

Mr Soh said FMM has written to the Human Resources Minister M. Saravanan in August, and met him in early September to request for a 12-month grace period for companies to undertake the extensive adjustments following the requirements of the law before the authorities impose punitive action.

FMM had obtained feedback from members nationwide on the various challenges faced.

He said many town and district councils were not prepared with standard guidelines and definite timelines to quickly approve applications to allow the industry to increase or convert lodging units for their workers. Some workers are housed in shoplots.

"Converting shoplots to dwelling space would take time, especially with the additional cost incurred to renovate the area following the specifications outlined in the regulations, apart from meeting other requirements by the local authorities," he said.

Small and Medium Enterprises Association of Malaysia president Michael Kang said the authorities should engage all stakeholders to understand the underlying problems first.

"Imposing such a hefty fine will only kill the industry," he said.

"The mid-tier companies said they could afford to provide better accommodation for foreign workers. But the majority can't. And most of the employers could not comply with such short notice," said Datuk Kang.

Malaysia Employers Federation executive director Shamsuddin Bardan said many employers would "die" faster if the hefty RM50,000 fine were to be imposed for every foreign worker staying in crowded units.

"It is a very expensive price to pay, especially given the current challenges. Why burden the employers further with additional cost during such challenging times?"

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