Amendments to EPF Act to Compel Foreign Workers to Contribute to Fund
Background
The Employees Provident Fund (EPF) is a retirement fund in Malaysia that provides a secure financial future for its members. The fund is mandatory for Malaysian citizens and permanent residents, but foreign workers have been allowed to join voluntarily. However, this voluntary system may be changing soon, as amendments to the Employees Provident Fund Act 1991 are expected to be tabled next week.
Compulsory Contribution for Foreign Workers
According to Ahmad Zulqarnain Onn, the chief executive of the EPF, the amendments will compel foreign workers to contribute to the fund. Currently, foreign workers can join the EPF voluntarily, but for it to be mandatory, changes to the Act are required. This move is expected to benefit two million foreign workers in Malaysia.
Contribution Rate and Mechanisms
The proposed contribution rate for migrant workers and employers is 2% each. The withdrawal mechanism for migrant workers will be disclosed in the next two months. Foreign workers have been allowed to voluntarily contribute to the EPF at a rate of either 11% for those aged below 60, or 5.5% for others.
Impact on Foreign Workers
The mandatory contribution to the EPF will have a significant impact on foreign workers in Malaysia. It will provide them with a secure financial future and a sense of security, knowing that they have a safety net in place. The change will also ensure that foreign workers are protected from exploitation, as they will have a financial cushion in case of job losses or medical emergencies.
Conclusion
The amendments to the EPF Act are expected to benefit two million foreign workers in Malaysia, providing them with a secure financial future and a sense of security. The mandatory contribution to the fund will ensure that foreign workers are protected from exploitation and have a safety net in place in case of job losses or medical emergencies.
Frequently Asked Questions
- What is the proposed contribution rate for migrant workers and employers?
- The proposed contribution rate is 2% each for migrant workers and employers.
- When will the withdrawal mechanism for migrant workers be disclosed?
- The withdrawal mechanism will be disclosed in the next two months.
- Can foreign workers currently join the EPF voluntarily?
- Yes, foreign workers can currently join the EPF voluntarily at a rate of either 11% for those aged below 60, or 5.5% for others. However, the proposed amendments will make it mandatory for foreign workers to contribute to the fund.