(From left) Low, Wahid, Dr Moreno and Dr Zachau after the launch of the 2015 Malaysia Economic Monitor at Bank Negara on Friday. (via The Star/ANN)

The cost of hiring foreign workers is expected to go up next year '€“ as part of a deliberate policy to reduce the number of foreign workers in the country.

Under the plan, employing a foreign worker is expected to cost at least 30% more for certain industries, making it cheaper for employers to hire locals instead.

Minister in the Prime Minister'€™s Department Datuk Paul Low disclosed this yesterday during a panel discussion after the launch of the World Bank'€™s Dec 2015 edition of the Malaysia Economic Monitor on Immigrant Labour.

'€œWe will recommend a revision of the levies for foreign workers based on industries and the minimum wages for the new system, which we hope to implement early next year,'€ he said.

Citing an example, Low said manufacturers might be made to pay higher levies for foreign workers to encourage the use of machinery and automation.

'€œWe will also come up with a plan to introduce this in stages, like starting with new recruits and slowly extending it to workers who are already here; perhaps when employers renew their permits,'€ he said.

Low said stricter conditions would also be imposed on employers to ensure that they complied with labour laws, warning that stern action would be taken against those caught abusing their workers in any way, such as by not paying wages or overtime or not providing proper accommodation.

'€œEmployers who defy the rules will face heavier fines or lose their hiring permits.

'€œThe onus will be on them to follow the laws.

'€œMore stringent monitoring and action will also be taken to combat trafficking and the practice of forced labour.

'€œWe will also come up with clear policies for victims of trafficking and refugees who are not allowed to work here legally,'€ he added.

Low, however, clarified that the new policy would not be applicable to domestic helpers or maids.

On the issue of undocumented workers being held in detention for overstaying or entering the country illegally, he said one of the options was to provide incentives to employers to hire them.

'€œWe can'€™t do away with the need for immigrant workers who are here temporarily and for a specific purpose,'€ he said.

A total of 11 government agencies are working together to tackle the issue of undocumented labour in the country and streamline existing immigration policies.

Among those who took part in the discussion were World Bank'€™s country economist for Malaysia Dr Rafael Munoz Moreno, country director Dr Ulrich Zachau and Minister in the Prime Minister'€™s Department Datuk Seri Wahid Omar.

Wahid said effective human capital management was a key priority in Malaysia'€™s aim to achieve high-income nation status by 2020.

He said in addition to encouraging innovation, automation and vocational education, reducing the dependence on low-skilled and low-cost immigrant labour would go a long way to generate a productivity-driven production base.

Dr Zachau said that a system that protected both low-skilled Malaysians and vulnerable immigrant workers would help Malaysia become a high-income inclusive economy.

'€œInternational experience shows that achieving such balance is difficult, but possible.'€

According to the economic report, immigrant labour reduced the salaries of immigrant workers already here by 4% and the wages of the least educated Malaysians (who comprised about 14% of the total labour force) by 0.75%.

The report called for the strenghtening of monitoring and enforcement of immigration and labour regulations, improving the unskilled workforce and adopting a levy system that responds to labour market needs, among other things. (kes)

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