Manufacturers reject PSMB move to pool unused HRDF levies

PETALING JAYA: The Federation of Malaysian Manufacturers (FMM) objects to Pembangunan Sumber Manusia Bhd’s (PSMB) decision to consolidate employers’ monthly Human Resources Development Fund (HRDF) levy contribution into pooled funds.
“Pooling funds means companies are subsidising others, including non-PSMB registered employers. Employers are denied the right to spend their HRDF contributions on training for their employees as funds are disbursed on a first-come first-served basis. Contribution to HRDF becomes an additional tax for companies when their levy is used by others,” it said in a statement yesterday.
With effect from April 1, PSMB intends to channel any unutilised portion of the 30% HRDF levy collected monthly from registered employers for the 1Malaysia Globally Recognised Industry and Professional Certification Programme (1MalaysiaGRIP) into a common pool.
PSMB would continue to take away 30% of employers’ monthly levy to be channelled into a second pool once the 1MalaysiaGRIP fund has accumulated RM100 million.
The objective of the second pool is to finance the 2016 National Budget measure to provide training for local industries in Sabah and Sarawak as well as an Outplacement Centre to retrain retrenched workers.
“The decision to take away unutilised levy in the employers’ 1MalaysiaGRIP account is hasty and unfair. Even regular levy is kept with employers for up to five years before forfeiture by PSMB. The 1MalaysiaGRIP commenced in June 2015 and approved programmes offered only in August 2015,” said FMM.
The federation said that many companies are unable to register their employees for certification courses under the 1MalaysiaGRIP scheme due to insufficient funds in their 1MalaysiaGRIP account, limited seats for the relevant courses, unavailability of relevant courses and training providers unable to secure funding from the government.
FMM said PSMB should help employers by allowing companies with insufficient funds in their 1MalaysiaGRIP account to use their 70% portion of the levy to cover the entire course fee and proceed with training.
It said that companies should also be allowed to claim daily allowances since they are utilising their levy (70%) for the 1MalaysiaGRIP programme instead of government funds.
It also suggested that PSMB should revoke Employer’s Circular No. 9/2015 and allow employers to continue to utilise their levy in the 1MalaysiaGRIP account.