Wednesday, September 24, 2014

MALAYSIA:::Direct hiring will curb abuse of workers, say Penang industries

Agencies allegedly take advantage of workers they recruited. – The Malaysian Insider file pic, September 24, 2014.Agencies allegedly take advantage of workers they recruited.As Malaysia comes under fire for worker abuse by a global labour rights group, industrial firms in Penang want Putrajaya to allow them to hire foreign workers directly to avoid problems caused by agencies who allegedly take advantage of and profiteer from workers.
Heng Huck Lee, president of The Free Industrial Zone, Penang, Companies' Association (Frepenca), said the government should allow only direct hiring as a way to circumvent any problems caused by “third parties”.
“Our members want to go direct, but the government does not allow us to do so,”

He added that quotas given to contract companies, which outsource labourers to firms, also contributed to the problem.
Heng was commenting on a recent report by international labour rights group Verite which concluded that a third of the workers in Malaysia's electronics industry suffered from debt bondage.
The report, titled "Forced Labour in the Production of Electronics Goods in Malaysia", was completed this year following funding given by the US Department of Labour in 2012.
Based on interviews with 501 workers, the study found that 28% of employees were in situations of "forced labour", where work is coerced through factors including indebtedness from excessive fees charged by recruiters.
That figure rose to 32% for foreign workers, who are often charged excessive fees that lead to indebtedness. Verite also found that 73% of workers in the sector showed "some characteristics" of forced labour.
Heng said the problem was related to agents who brought in the workers from other countries as well as companies that are licensed to outsource them to industries.
He said as far as possible, the members of Frepenca, which consists of more than 60 firms including US, Japanese and European giants with plants in Penang, try to get their own workers.
He said it was proven in many companies that if the hiring through agents or contract companies were stopped, the problem of abuse of the foreign workers would subside.
“If the workers all are hired directly, they are in fact well-treated, in some cases even better than the locals, with similar salaries and housing provided,” he said.   
He added that companies also benefit by not having to undergo the rigours of going through a third party.
On the assertion by the Malaysian Trades Union Congress (MTUC) that there was a need for unions to be allowed in companies as a way to curb the problem, Heng said the issue was mainly related to agents.
“This is not a union problem. It is an agent problem,” he said.
He said agents continued to take advantage when companies did not hire directly, and in many cases, they sought to profiteer from the workers.
According to the Verite report, one in five workers interviewed was misled in the recruitment phase about the terms of their employment agreement.
“Twenty-two per cent of foreign workers were deceived about their wages, hours, overtime requirements or pay, provisions regarding termination of employment, or the nature or degree of difficulty or danger of their jobs,” the report said.
Verite also found workers' passports were often retained by recruitment firms, which is prohibited in Malaysia.
Penang’s free industrial zones in Bayan Lepas and Seberang Prai are major hubs for Malaysia’s thriving electronics sector.
According to the Malaysian Investment Development Authority (MIDA), the electronics and electrical industry contributes significantly to the country's total manufacturing output (27%), exports (49%) and employment (33%). – September 24, 2014.

1 comment:

  1. This was also a recommendation at the recent round table.