PETALING JAYA: The Malaysian Employers Federation (MEF) has
expressed surprise over the Government’s announcement of new pension
and retrenchment funds.
No discussions had been held by the
Human Resources Ministry with MEF and other stakeholders on the matter,
MEF executive director Shamsuddin Bardan said, adding that the funds
would have a major impact on the cost of doing business.
Human
Resources Minister Datuk Dr S. Subramaniam had announced that a pension
scheme for the aged and self-employed and a retrenchment fund for
private sector employees would be introduced next year.
“The MEF
Council is taken aback by the announcement that the ministry is already
in the process of introducing the retrenchment fund for private sector
employees although the proposed funds are still under discussion, and
no final conclusion has been reached,” Shamsuddin said in a statement
after the council meeting yesterday.
He said there was no need
for a new retrenchment fund as the present system worked well, and
current labour laws were adequate to punish delinquent employers.
Shamsuddin
said employees were entitled to retrenchment benefits and an employer’s
failure to fulfil this requirement constituted a very serious breach of
law.
“The proposed retrenchment fund would be a bailout for
recalcitrant and badly-managed companies while punishing good and
well-managed employers,” he added.
“(Good) employers have to
contribute to the fund on a monthly basis and in the event of a
retrenchment, they have to pay termination benefits from their own
funds. Employers should be allowed to manage and administer their own
funds for retrenchment benefits.
“Reliable statistics should be
made available to indicate the actual number of employers who have not
paid their employees retrenchment benefits over the years.”
On
the pension fund for the aged and self-employed, Shamsuddin said it was
a duplication of the efforts by the Employees Provident Fund, which
required monthly contributions from private sector employees (8%) and
employers (12%).
It was unfair and costly for private sector employers to contribute to EPF as well as to the proposed pension fund, he added.
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