PSM welcomes amendments to Employment Act

The first reading of the amendments to the Employment Act 1955 was read and passed on Monday. PSM welcomes some of the amendments as pertinent and long overdue. We congratulate the Minister, the Ministry and its staff who have been working hard over the years to bring about these changes. The last time the employment act was amended was in 2012. Since 2018, there were many discussions and PSM also participated in these dialogues and proposed changes.

In October 2019, PSM also welcomed the amendments to the Industrial Relations Act. At that time we were told that Industrial Relations Act amendments wouldn’t be complete without the amendments to the employment act and the trade unions act. We are happy that at least some of these reforms have finally taken place in the current parliament sitting.

The class war between the workers and the bosses has been a long drawn war. In the late eighties and early nineties, several amendments brought by Mahathir the fourth Prime Minister to please neoliberal capitalists saw many laws to protect investors and foreign employers against industrial action by workers. Workers rights and especially union rights were curbed effectively and legally. The influx of migrant labour also ensured cheap labour policies, wage suppression and poor bargaining power for the unions. The unions today are handicapped and weak; without strong representation from the unions, the fates of the workers are left to the hands of the state.

While these amendments did not address some of the main issues of the abuse of contract system and wage suppression which PSM has always championed, yet it did give a better and wider protection to the workers as well as improved workers standards overall. It is said that the amendments were intended to put in place standards and practices required by the Trans-Pacific Partnership Agreement and the International Labour Organisation standards. Whatever the reason may be, PSM is happy that it has benefited the working class.

One of the major amendments is that the Employment Act now gives coverage to all workers and is not limited to workers who earn RM 2,000 and below. Currently many workers who earn above RM 2000 are not covered under this act and are forced to take up matters in the civil courts which they don’t have enough money to pursue and they end up in a limbo. This amendment will now include more workers and give bigger coverage to all workers to bravely take up their cases to the labour court. The Employment Act today guarantees minimum standards but not everyone is entitled to bring cases to the Labour court because of the RM 2,000 cap.

Another significant gesture of these amendments is that it takes into account discrimination and forced labour as well and includes provisions for maternity benefits; all demands which have been long raised by many women’s rights and labour activists.

Another long overdue amendment is that maternity leave has been increased from 60 days to 90 days as what was introduced to the public sector in 2020. Previously the private sector only allowed paid maternity leave of 60 days. Meanwhile husbands are now given paternity leave of 3 days when previously it was not given. The new provision in the Act also gives pregnant women more protection from being harassed by employers.

Another small victory is when working hours were reduced from 48 hours to 45 hours. Though PSM has previous spoken about 4 days work or 36 hours, yet this amendment means workers can have a bit more time to rest.

Another safeguard is all employers and contractors must give written contracts to their workers failing which they can be fined up to RM 50,000. Previously verbal or oral contracts were allowed but this can also end in disputes as there is no proof on what is agreed upon. Now the new amendment has put an end to this ambiguity as verbal and oral agreements are not allowed.

On migrant workers, who make a significant portion of our workforce: one of the major policy calls by PSM and other stakeholders including the government and employers is for the management of foreign workers to be handled by the Human Resources Ministry and not the Home Ministry. During PH rule, former judge Hishammudin Yunus headed a special independent committee on foreign worker management and had produced a report comprising of 40 recommendations. Sadly the PH Government did not make this public and the report has not seen the light of day. It is no secret that migrant labour is big business.

In spite of that, the recent amendment now gives the Director-General (DG) of the Human Resources ministry some powers where it is now compulsory for all employers to seek the DG’s approval before being allowed to employ migrant labour. With the current practice, employers who have a bad record in migrant labour management or who are blacklisted can be prevented from employing new migrant workers. Previously the law only requires the company to notify the Human Resources Ministry after they have been employed. Another provision is that any termination or sacking of migrant labour, must be notified to the DG within 30 days.

Another good amendment is that workers are no longer compelled to get leave only from the Employer’s panel clinic. Previously the employer’s panel clinics had the authority to give sick leave. This has its problems since these clinics get their contracts from the companies and may be biased towards the companies. We have also seen cases when the companies do not even recognise medical leave from government hospitals. With this amendment, it will allow workers to seek treatment from other hospitals or clinics as well as have their medical certificates recognised.

Another significant change is that workers now have an extra week (21 days) to make appeals to the High Court when it was previously only 2 weeks. It would have been better if the worker were allowed a month or a longer period to appeal. The current 2 weeks dateline is too short and rigid. In most cases, workers will be unable to decide on the appeal in such a short time because they also need to raise money and look for lawyers and these are not easy and can be very costly. Therefore an extra 7 days proposed now is better than the current 2 weeks deadline.

Another legal burden which was previously borne by the workers is now rightfully shifted to the bosses. Previously a worker who has been terminated has to prove that he worked in the company and needs to get extra documents and even lodge police reports etc. The company can even deny that the workers had worked there and the burden of proof was on the worker. With the amendment now, the burden to prove a workers is not an employee is shifted to the employer. Therefore this bureaucratic task is no longer imposed on the workers.

Overall the current amendment also increased the penalty in section 99A of the Employment Act. This increase was from RM10,000 to RM50,000 for any offences under the law. For offences on forced labour, a fine of RM 100,000 and a prison sentence is also proposed.

PSM now hopes that the new law will be passed swiftly and gazetted soon so that it can be enforced and will be able to give some justice to the workers. These are small victories in the long struggle between labour and capital. Many of these rights of the workers have been curbed over the years by neoliberal Governments. Today some things were retrieved but we still have a long way to go to restore the rights of the workers. The struggle of the workers will continue.

S. Arutchelvan
Deputy Chairperson
Parti Sosialis Malaysia

28-10-2021

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