The Malaysian Trades Union Congress has warned that exempting existing migrant workers from the minimum wage and EPF contributions could cause Malaysia to be downgraded to Tier 3 in the US Trafficking in Persons (TIP) report.
MTUC secretary-general Kamarul Baharin Mansor said DAP adviser Lim Guan Eng’s remarks that both benefits should be withheld for existing migrant workers were “out of touch” with the realities faced by foreign and local workers.
Kamarul accused Lim of promoting discriminatory policies that would exploit foreign workers by paying them low wages without social protection.
“Malaysia’s reputation has already been tarnished by reports of forced labour, which have led to the restriction of Malaysian goods.
“Any attempt to exploit foreign workers with low wages and no social protection will undermine the government’s goal of achieving Tier 1 status by 2030,” he said in a statement today.
Malaysia was upgraded to Tier 2 in the TIP report last year, which defined the country as not fully meeting the US state department’s minimum standards to eliminate human trafficking, but making significant efforts to do so.
It was previously in Tier 3 in 2021 and 2022, which put the country at risk of potential export sanctions.
Kamarul said the minimum wage is a vital tool to increase workers’ incomes, noting that many workers, including those employed for over 25 years, still earn only the minimum wage of RM1,700.
“MTUC urges the human resources ministry to take enforcement action against employers who fail to comply with the new minimum wage. The new rate has been fully enforced since Aug 1,” he said.
Debating the 13th Malaysia Plan in Parliament on Aug 6, Lim, the Bagan MP, said there was no need to mandate the RM1,700 minimum wage and 2% EPF contributions for existing migrant workers who were hired under previous terms. He said the two benefits should apply only to new foreign workers.
He pointed to Singapore’s policy of not requiring Central Provident Fund contributions for migrant workers since 2003 without repercussions from the International Labour Organization, adding that Malaysia was not bound by any United Nations or ILO conventions.
Lim’s stance drew criticism from various parties, including human resources minister Steven Sim, who said protection of foreign workers was not merely about fulfilling ILO conventions, but as a fundamental human rights issue.
