The announcement by the Malaysia Immigration Department on Tuesday that it would freeze the assets and bank accounts of employers hiring illegal foreign workers has been described as costly and complicated for the business community. This description indicates the severity and unpopularity of this latest decision among business owners. Among the key economic sectors to be affected most by this decision could be plantations, construction, service and manufacturing.
Technically, there is full employment for Malaysians and there is definitely a shortage of labour.
To be enforced next month, this Immigration Department decision has stirred up a huge furore among almost all trade groups, including the Federation of Malaysian Manufacturers and the Associated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM).
It seems like a hasty and harsh move threatening to shatter the private sector that has helped the country to build up its economy.
Business operators feel that it is the country’s economy that stands to lose if the decision is not reversed.
“There is a necessity for foreign workers in our country, but the system to hire legal workers is costly and complicated,” said lawyer Michael Chai, deputy secretary general II of the ACCCIM.
“The way to resolve it is not to throw a nuclear bomb at the industry.”
Datuk Michael Kang, president of the SME Association of Malaysia, told Nanyang Siang Pau that about 80% of local SMEs will be wiped out if this decision is enforced as almost 80% of local SMEs hire illegal foreigners.
There are about 650,000 SMEs in the country and they form more than 90% of the companies registered in Malaysia.
Kang told The Star: “The Government should legalise all illegal workers. All legal and illegal workers should go for fingerprint imaging so as to monitor them.”
The issue of foreign workers is an age-old problem plaguing the country.
The Government wants Malaysia to be free of illegal immigrants by 2020 and aims to bring down the percentage of foreign labour in the workforce to 15%.
According to ACCCIM deputy secretary-general I Tan Sri Teo Chiang Kok, illegal labourers in Malaysia now total 3.5 million compared with Malaysia’s total population of more than 30 million.
Teo said if the system for the industries to bring in legal foreign workers was easy, the issue of illegal labour would have to be solved “once and for all”.
If we look back, the Government has rolled out many measures to tackle the problem.
Fresh in our minds are the 6P Programme, the “whitening” of illegal migrant workers, and the suspension of recruitment of all foreign workers (which has since been lifted for manufacturing, construction, plantation and furniture-making industries).
With this latest announcement by Immigration, it is clear that the illegal labour issue has yet to be resolved.
The Immigration Department’s decision is yet another knee-jerk policy that only treats the symptoms but not the root cause of the problem, according to Teo, who is involved in property development.
“A lot of times the Government is just putting obstacles and using threatening methods (on us). This is not the way to address the problem,” he said at an ACCCIM press conference on Thursday.
Industry players say they always prefer local and legal workers, given the option.
If the Government’s strategy is to push employers to hire more locals, the current unemployment rate of 3.3% is technically considered full employment.
“This means that there are just not enough local workers to meet the labour demand in our economy,” said Teo.
Indeed, this may not be the right time for the Government to push hard for automation as many SMEs are not prepared amid weak economic conditions.
According to the latest survey conducted by ACCCIM on the economic situation of Malaysia for the first half of the year, a total of 14.1% of the respondents were eager to give automation a try to address the difficulty in hiring foreign labour.
However, they said capital shortage, lack of technical know-how and the limitation of a small market in Malaysia were obstacles.
“I believe one day our country will move towards that direction, but we seriously require time.
“We need a good blueprint on the foreign labour scheme for us to have a smooth transition,” said ACCCIM president Datuk Ter Leong Yap.
But above all these, lawyers have cast doubt on the legality of the Immigration Department’s move to freeze assets.
The Immigration Act 1959/63, the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act (AMLA) 2001 and Passports Act 1966 have been cited to grant such legal powers to the department.
But as Chai correctly pointed out: “People who have power to exercise this ‘nuclear weapon’ have great responsibility. They cannot announce something without clarification.”
Perhaps top policy decision makers of the country will have to interfere in this latest initiative by the Immigration Department. They have to put right what is damaging to the country’s economy.
Foreign Worker News source: The Star
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Immigration Department director-general Datuk Seri Mustafar Ali (pic) said the government made the decision to legalise the employment of foreign workers following high demands from several sectors.
Equipped with a biometric security system, the E-kad registration will be free and valid for one year – until Feb 15, 2018. Department director-general Datuk Seri Mustafar Ali (pic) said employers could apply for the 
“The government made this decision to register all employers who hire foreign workers to address labour shortages in several key economic sectors,” said Immigration Malaysia director-general Datuk Seri Mustafar Ali.