Prihatin Plus cuts foreign worker levy by 25pc, opens doors for firms to explore unpaid leave, pay cuts

Danial Dzulkifly
People watching and listening to the prime minister’s live telecast in Kuala Lumpur on April 06, 2020. Tan Sri Muhyiddin Yassin said the government will discount the foreign worker levy by 25 per cent for payments due between now and the end of the year. — Picture by Miera Zulyana

KUALA LUMPUR, April 6 — The government will discount the foreign worker levy by 25 per cent for payments due between now and the end of the year, Prime Minister Tan Sri Muhyiddin Yassin said today. 

In his announcement of the expanded Prihatin Plus stimulus package today, Muhyiddin said the move was part of initiatives to reduce the financial burden on small- and medium-sized enterprises (SMEs) caused by the Covid-19 pandemic and the subsequent movement control order (MCO).

However, the discount will not apply to domestic workers.

“Levy payments for foreign workers will be reduced by 25 per cent for all companies where their work permits end on April 1 to December 2020. The reduction in levy payments, however, is not extended to housemaids,’’ he said.

Muhyiddin went on to acknowledge the dilemma employers faced in retaining their workers during desperate times. 

As such, he said the government has agreed to encourage negotiations between employers and workers about existing terms of employment, including the option of pay cuts and the provision of unpaid leave during the MCO period

“Employers and employees can consult the Labour Department for advice on any issues that may be resolved. Any consultation should be subject to employment law in this country. Importantly, the rights and welfare of both parties must always be maintained,’’ he said.

To reduce red-tape throughout the MCO, Muhyiddin also announced an automatic 30-day deferment for companies submitting their annual statutory compliance documents from the expiry of the order.

“This flexibility is granted to companies with financial years ending September 30 to December 31, 2019.

“However, the company will need to apply for such relaxation from SSM and no late delivery fee will be charged on the application,’’ he said.

The additional Prihatin stimulus package today saw Putrajaya allocate an additional RM10 billion for SMEs, top of the people-centric economic aid worth RM250 billion already announced on March 31.

The additional stimulus package also saw wage subsidies double to RM13.8 billion, potentially protecting the jobs of 4.8 million workers across the country.

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