Monday, May 30, 2011

Hishammuddin, we do not believe you - release these ISA detainees now

We do not believe you - because under the ISA (and other Detention Without Trial laws), you can effectively arrest and keep in detention any person alleging this and that ..... and this is certainly against justice and human rights...

So, immediately and unconditionally release the said 3 persons now...

If any person really broke Malaysian laws, then charge them in court and allow them the right to defend themselves in a fair and open trial...and, if the court is convinced with the evidence that you have and you have managed to prove them guilty, then the court will convict and sentence them...

Malaysia already have an anti-human trafficking Act - so, what is the problem of taking action under this Act.

And, is this really a case of 'trafficking' - or was it just a case of persons assisting immigrants/asylum seekers/refugees enter Malaysia? Smuggling persons into the country is different from 'trafficking of human persons'. A smuggler is a person who illegally facilitates the entry of persons into Malaysia - people seeking the services of 'smugglers' do it of their own free will...many a times paying for this service. Trafficking of human persons on the other hand is where the person being trafficked is brought in forcibly, without consent, etc... Smuggled in persons are certainly not victims of human trafficking... and that is why we cannot lump both 'people smugglers' and 'human traffickers' together...

Three people including two foreigners were detained under the Internal Security Act (ISA) in Lahad Datu on May 24 for suspected human trafficking involving illegal immigrants.

Home Minister Hishammuddin Hussein, who confirmed this, said the trio were found to be active in smuggling illegal immigrants through land and sea routes.

However, he declined to disclose their identities.

The action was in line with the government's firm stand in tackling security threats to the country, he said after handing over appointment letters to the new Sabah Registration Department director Ismail Ahmad and Sabah Prisons Department director Suria Idris, both of whom are Sabahans, here today.

He said the arrests of the trio enabled more detailed investigations to be carried on human trafficking syndicates, particularly those operating in Sabah.

He added that the arrests were also part of the measures being taken by the government to check the inflow of illegal immigrants into Sabah.

On the new appointments, Hishammudin said he hoped it would help further improve the delivery system of the two agencies under his ministry.

"They have wide knowledge and experience on the local situation and are committed to discharge the responsibilities entrusted to them," he said, adding that with their appointments, five of nine department and agency directors under the ministry in Sabah now were locals.

He also dismissed perceptions held by some quarters that the percentage of locals employed in federal agencies in the state was very low.

Citing the departments and agencies under his watch, Hishammuddin said the majority of the staff in them were locals with the percentage between 70 and 97 percent. - Bernama - Malaysiakini, 29/5/2011,
3 held under ISA for human trafficking

Evictions in Pakatan Rakyat ruled Selangor?

Below an email that I received:-
Penduduk PJS1 akan menghadapi pengusiran paksa pada hari Isnin , 30/5/2011 oleh 
pemaju yang mempunyai perintah mahkamah . Sehingga kini Kerajaan Negeri Selangor 
PR masih gagal bertindak menghentikan pengusiran ini . Justeru itu , semua dijemput
untuk mempertahankan perjuangan penduduk PJS1 

Tarikh: 30 hb.Mei, 2011
Masa: 7 pagi 
Tempat : Rumah Panjang PJS 1, Jalan PJS 1/52
dibelakang Wisma Peters , Jalan Klang Lama
Click here Map to PJS1 Rumah Panjang

Untuk maklumat lanjut sila hubungi Siva : 016 6798005
Sivarajan Arumugam 
016 6798005

Saturday, May 28, 2011

Spending too much on Defence - and unnecessarily increasing cost of living

Why are we wasting so much money for Defence spending? 

We may need air-ambulances and fire-fighting helicopters ... but certainly not submarines and other military hardware...

Are we being forced to buy military hardware as part of some 'trade agreements'?

Malaysia is not in war with anyone at the moment - and we seem to be spending more than Thailand, Indonesia and Philippines.

Let us also not forget to take into account population - and we find that Malaysia's spending per person for Defence is just too high...
Malaysia's BN government says that they have financial problems - and cannot anymore afford 'subsidies' - and need to cut it ....end result increase in the cost of living...

Are we heading for a 100% capitalistic model - when we know that capitalism has failed, evident in the US where the number of 'new poor' and homelessness is on the rise...
Najib and his BN government must stop this trend which will ultimately be very bad for Malaysians especially the poor, the 'not so competitive', the elderly, ...

We still need to accept that all times, now and the future, we will need to share and ensure a good life also for the poor, weak, marginalized, disadvantaged,.... 
We do not want a Malaysia that promotes 'self-centredness' - you want to benefit, you go for it and reap its benefits...Those who do not 'win' the rat race will just have to suffer the consequence of their failures, weakness, etc... We certainly do not want this for we understand fully that a community is made of people, not all who will win the 'rat race', and as community we need to be striving for the good of all - not just I and my family and 'my gang'.

Thursday, May 26, 2011

Malaysia's poverty rate - 3.8% or over 30%?

It is so difficult to find the poverty line income in Malaysia - so, how really is the government telling us the number of persons that are below the poverty line - and who are 'hardcore poor'....There must be transparency here.

One way of instantly reducing poverty is to lower the 'poverty line income' - and then suddenly the number of poor immediately decreases...and the government has successfully battled poverty...

Another way is to just not increase the 'poverty line income' despite the increases in cost of living and your poverty rate may stay the same ....or only increase minimally. 

The problem in Malaysia, is that the poverty line is realistically too low...

If we use Malaysian government standard, then poverty line income is RM763 per month for a family of 4.4 equals to RM5.80 per person per day
“RM5.80 is supposed to pay for three meals, transport costs, rent, recreation and the other components for ONE person in ONE day. Tell me, can a Malaysian in the Peninsula even buy three meals a day on RM5.80?
If we use The World Bank standard .. that medium-income countries should calculate PLI based on US$2 (RM6.20) per individual per day. Meaning one person would need US$2 per day in order to meet both food and non-food necessities.If that figure were used for Malaysia, a theoretical household of 4.4 people would then need RM858 a month to not be declared poor.

If we use British/Australian standards to calculate poverty line income  - RM1,886 per month.
countries such as Britain and Australia calculate PLIs based on the median income of its households. The median income is a country’s total income divided by half. The PLI is two-thirds of the median income. In Malaysia the median income is RM2,830. Using this method, the PLI would then be RM1,886. In effect, this translates into RM14.20 per day for an individual to meet all their eight needs.

But, we were talking about 2009 figures, and today in 2011 there has been an increase in the cost of living - no thanks also to the BN government's insistence in reducing government subsidies that causes rise in prices of basic things all Malaysians need... Malaysia is getting wealthier but alas there is no equitable distribution of wealth to we must stop looking just at the state of the economy generally - and start looking at the state of economy of individuals and families in the country...

How poor are we, really?

July 21, 2010
KUALA LUMPUR, July 21 — The government likes to boast that Malaysia has almost erased poverty. It is the one unchallenged success that is shouted out again and again to show how far we have come since Merdeka.

The line is familiar: “In 1970, 49.7 per cent of households were living in poverty. Now it is only 3.8 per cent.” Or out of 6.2 million households, only 228,400 can be classified as poor.

These 228,400 are households that earn an average of RM800 a month and below.

Is RM800 a fair cut-off point? Because it effectively means that if a household of four earns RM900, RM1,000, or even RM1,500 a month, they cannot be considered poor.

If that is the case, then why are there more and more media reports of families complaining that they cannot make ends meet even when they earn RM2,000?

How did the government calculate and decide that RM800 is the poverty line?

Jayanath Appudurai, who writes extensively on poverty for the Centre for Policy Initiatives, believes that the government’s calculations are unrealistic.

Here, he argues that we need a new standard to measure poverty — one that more accurately represents the cost of food, clothing, rent and other basic necessities, and how much it takes for an average family of four to keep themselves afloat in today’s Malaysia.
Jayanath’s assessment is based on government data in its 10th Malaysia Plan (10MP) report released in June, and the New Economic Model (NEM) that was out in April.

The Poverty Income Level (PLI) is defined as:
“An income that is necessary to buy a group of foods that would meet the nutritional needs of the members of a household. The income is also to meet other basic necessities such as clothing, rent, fuel and utilities, transport and communications, medical expenses, education and recreation.”

Plainly speaking, the PLI is how much money in a month a Malaysian household needs to meet these eight components.
Though the Government calculates different PLIs for Malaysia’s three regions, the total average PLI is RM800.

For this demonstration, Jayanath uses the Peninsula PLI of RM763.

A household living in the peninsula is considered poor only if its monthly income is below RM763.

“The government claims that it uses a World Bank standard to measure PLI. But they do not reveal the actual methodology of how they arrive at RM763,” says Jeyanath.

The World Bank standard, Jayanath says, recommends that medium-income countries should calculate PLI based on US$2 (RM6.20) per individual per day. Meaning one person would need US$2 per day in order to meet both food and non-food necessities.

If that figure were used for Malaysia, a theoretical household of 4.4 people would then need RM858 a month to not be declared poor.
The government considers a household as comprising an average of 4.4 members, says Jayanath. (Total number of households divided by total population = 4.4).

The PLI of RM763, therefore, is translated into a daily income of RM25.45 that a household needs to meet the eight components such as food, rent, clothing and fuel.

“Or, that if a member of a household earns RM5.80 a day, they cannot be considered poor. 

Since, according to the government, you are able to live on RM5.80 a day.

In other words Jayanath explains:
“RM5.80 is supposed to pay for three meals, transport costs, rent, recreation and the other components for ONE person in ONE day. Tell me, can a Malaysian in the Peninsula even buy three meals a day on RM5.80?

“In fact, I’d challenge our government ministers to try that,” said Jayanath
Jayanath says countries such as Britain and Australia calculate PLIs based on the median income of its households. The median income is a country’s total income divided by half.

The PLI is two-thirds of the median income.

In Malaysia the median income is RM2,830. Using this method, the PLI would then be RM1,886.

In effect, this translates into RM14.20 per day for an individual to meet all their eight needs.

“Compared to RM5.80, is not RM14.20 a more realistic figure in terms of how much one needs per day in Malaysia?”

A former finance minister had once said, repeatedly, that if we were to revise how we measure poverty, our poverty rate would not be the vaunted 3.8 per cent. He is right, technically.
Jayanath’s calculations would put Malaysia’s poverty rate at somewhere between 31 to 32 per cent.

“Our poverty level looks good on paper but woefully ignores reality. We are so obsessed with selling this story that we are a success.”

Statistics are supposed to accurately measure our economic environment, so that in this case, pin-point policies to deal with poverty can be crafted.

The government has begun scaling back subsidies so that they would only benefit those they are meant for — the poor.

How is it supposed to do this if we cannot even accurately measure who the poor are? - Malaysian Insider, 21/7/2010, How poor are we, really?

An 'anti-worker' government will not want minimum wage laws anytime soon...

The lack of minimum wage laws in Malaysia is indicative that the BN government really is not very concerned about workers.

34% of Malaysians earned less than RM700
A further 37% nationwide earned between RM700 and RM1,500
63%  of workers in Sabah earned less than RM700
48%  of workers in Sarawak earned less than RM700

When workers demand higher wages, employers have generally ignored these demands, and the government has not come to assistance of workers - but have generally sided employers by making it difficult for workers to unionize and/or take actions to fight for better wages. There is still no clear provisions in law that makes it an offence for an employer to discriminate against and/or terminate a worker that lodges a complaint at the Labour Department claiming rights. The worker who gets 'wrongfully dismissed' also ceases to be a member of his/her trade union - hence, when workers most needs the support of the union, they are legally deprived of this support.

Eventhough our Employment Act 1955 clearly provides for security of tenure until retirement, the government has allowed the creation of short-term contractual employment (which I believe is 'illegal), and was even considering depriving such contractual workers the right to claim for wrongful dismissal and hence the remedy of claiming reinstatement without the loss of benefits. It has even allowed employers to evade employment relationships with workers that work work at its factory/plantation/ just not enforcing the current law. The claim by employers is that these are not their workers - hence they cannot be part of the in-house union, or be part of the process of 'collective bargaining'. In some companies, these 'not our workers' is about 30 - 50 % of the workforce.

'Market forces'? What 'market forces'? Even if 'market forces' were allowed to operate freely and fairly, Malaysian workers would be earning more today but it has been 'government intervention' that has helped employers and acted against workers in this negotiation process when it comes to demands of better wages and rights. 

When workers demand higher wages and better benefits, the government came in to help employers by bringing in more workers who were willing to be paid much less....and recently by even allowing for part-time workers who could be paid less given lesser than what was legally guaranteed worker rights and benefits. The, it is really a pro-big businesses and corporations government really - and certainly an anti-worker government is what we have today.

India, for example, has had minimum wage laws since late 1940s - and, so is the case with most developed and developing nations - but not Malaysia.

Making a case for minimum wage

The real reason Malaysian productivity is low is not because workers are not productive. It is due to the fact that employers have been successful in suppressing wages, and there is no incentive to invest in research and development for productivity improvement. 

AFTER much debate, the Government has announced that the Minimum Wage Bill will be tabled in Parliament next month.

Even Prime Minister Datuk Seri Najib Razak has stated that companies must embrace minimum wage as a strategy and an opportunity to revitalise their businesses.
This is one of the most important and eagerly awaited piece of legislation as workers have long cherished a hope for higher income.

Employers, on the other hand, are concerned that it might drive up the cost of production so much so that their businesses may not be viable anymore.

I am part of the MTUC’s efforts striving for a minimum wage during the past decade. I am fully aware that employers with their powerful political connections can still derail the legislation, or worse, dilute it until it becomes meaningless and ineffective.

Let me address some concerns and misconception about minimum wage. It must be noted that minimum wage is not just a social tool to reduce poverty; it is a fiscal tool to enhance economic growth and improve productivity.

Wages should be determined by market forces 

Employers have successfully convinced the government over the past 40 years to let wages be determined by market forces. The evidence has clearly pointed to the fact that wage levels in Malaysia have been suppressed and have lagged behind by all measures.

The World Bank has reported that wages in Malaysia increased by only 2.6% per annum. That is below inflation. The proportion of wages as a portion of GDP has also fallen.

The 2010 National Employment Returns showed that 34% of Malaysians earned less than RM700 — below poverty line of RM842 in Sarawak.

In Sabah and Sarawak, where the cost of living is much higher, the figures are a dismal 63% and 48% respectively. A further 37% nationwide earned between RM700 and RM1,500. For a country aiming to be a developed nation in 10 years’ time, it is alarming that 72% of workers earned less than RM1,500. These are collaborated by similar figures from the Employees Provident Fund.

Fifteen years ago, the salary of a part-time worker at a fast-food restaurant was RM3.80 an hour. Today it is just RM2.80 while the price of a burger has gone up from RM1.20 to more than RM4 in the same period.
So clearly market forces have not worked. There are two reasons:

·Stiffled trade unions — Market forces are controlled by business, and combined with the government policy of stifling trade unionism by segregating trade unions, only 3% of private sector workers are trade union members, and less than 2% are covered by collective agreements. While the number of trade unions has increased most of the unions are in-house unions with less than 100 members.

·The presence of millions of foreign workers — Malaysia is perhaps the only country in the world that made it extremely difficult for high-value and knowledgeable workers to work here, but has welcomed millions of low-wage and unskilled workers. This has undoubtedly suppressed wages, as Malaysian workers have to compete for low wages.

Will minimum wage lead to retrencments and business closure?
If companies are legally compelled to pay their employees more than they can afford, then naturally they would have to retrench their workers.

Firstly, the presence of more than two million legal (and God knows how many illegal) foreign workers shows that there is no unemployment in Malaysia. Our official unemployment rate is less than 4%, which by World Bank standards show full employment.

Secondly, if indeed it is true that minimum wage will lead to some retrenchment, it will be those low income workers who are mostly foreigners. Surely, this will help our nation’s objective to reduce foreign workers. It will also be in line with our aim to move away from a low-wage labour intensive manufacturing based to up the higher value chain.

Frankly, if a firm cannot even provide a decent living wage to its workers — one that is enough to meet their basic needs — it has no business being in business.

Will minimum wage reduce productivity?

If a company now has 100 workers each earning an average of RM500 a month, and if the minimum wage is to be increased to RM900, its wage bill will now be RM90,000 instead of RM50,000 — a huge increase and may not be sustainable.

However the real question is does it really need 100 lowly paid, low-value workers?

You can tap rubber for 25 hours a day, but if you still use the same tapping tools your grandfather used, how do you increase output? Or the construction workers who still use hand-assembled timber formwork to construct flyovers and buildings instead of pre-frabricated ones or the toll operator who has to manually hand out tickets?

The answer would be to automate the issuance of tickets. But employers would not invest in machines or integrated building systems (IBS) because it is more profitable to employ cheap labour. In Incheon Airport in South Korea, two women in their sixties can effectively manage the luggage trolleys, while in KLIA we have an army of Bangladeshis.

This is not because Korean women eat lots of ginseng, but they have a machine that collects the trolleys magnetically and tows them along.

In Malaysia the banking industry is a shining example. The banking industry is the most densely unionised, with even assistant managers being union members. Wage levels are amongst the highest in the country.

Yes, once in a while you hear of picketing, but productivity and more importantly profits are consistently the highest in the country.

Investment in technology and management systems is the highest and business efficiency has improved to an extent that banking now is global, 24 hours a day, seven days a week and 52 weeks a year. And apart from some expatriates, there is not a single lowly paid foreign worker.

The real reason that Malaysian productivity is low is not because workers are not productive. It is due to the fact that employers were very successful in suppressing wages. There is no incentive to invest in research and development for productivity improvement. It is more profitable for employers to pay RM12 a day for foreign labour.

So higher wages and a minimum wage will lead to higher productivity. Higher wages will encourage employers to invest in research and development to increase overall productivity and efficiency.

A minimum wage will not hurt Malaysia’s competitiveness
Our competitors in the 1980s, Taiwan and Korea and even Hong Kong, the bastion of capitalism and free markets, have minimum wage systems while in Singapore the head of the trade union movement is a government minister and thus the country is able to formulate an inclusive wage policy that has seen wage levels more than three times higher than Malaysia and productivity growth that has outstripped us.

These four countries have overtaken us, became high-income nations while we now compete with Vietnam, Indonesia and Philippines.

More than 90% of countries worldwide have minimum wages. Empirical evidence in more than 100 countries worldwide showed that there is minimal negative impact on competitiveness and unemployment where a reasonable, value adjusted, and regularly reviewed minimum wage is implemented.

To be a high-income nation under New Economic Model, the government has to be serious and change our policy of being a low-wage country, restructure employment to create decent and productive jobs. A minimum wage policy will go a long way to achieving this aim.

A major benefit to the country is that higher wages will lead to higher purchasing power that will lead to increase domestic demand and more business for local companies.

What should be the minimum wage?

It appears that the bill to be tabled in Parliament will provide for setting up of a National Minimum Wage Council (NMWCC) that will be mandated to determine and review the level of minimum wage. I would urge that this be a tripartite body with independent experts and representatives from employers and employees.

This should allay fears that the minimum wage level will be set arbitrarily. I am confident that the NMWCC will be able to set a minimum wage after taking into account relevant factors, including cost of business, cost of living and regional differences. It must always bear in mind that a big bold initiative is needed to make Malaysia a high-income nation. - Star, 22/5/2011, Making a case for minimum wage

Tuesday, May 24, 2011

Consumers, Shareholders, People have a right to know about HR violations in companies

When made aware of information about human rights and/or worker rights violations, what should one do? Just assist the victims to lodge police reports, lodge complaints at SUHAKAM, lodge complaints at the Labour Department and/or Industrial Relations Department, or other relevant government agencies? Or should one also highlight it to the public as well? I am of the position that knowledge of human rights violations (or alleged human rights violations) should be highlighted to the public  - and this right, duty and obligation is clearly also stated in the UN Declaration on Human Rights Defenders.

"...Everyone has the right, individually and in association with others, to promote and to strive for the protection and realization of human rights and fundamental freedoms at the national and international levels....
"....freely to publish, impart or disseminate to others views, information and knowledge on all human rights and fundamental freedoms;

c) To study, discuss, form and hold opinions on the observance, both in law and in practice, of all human rights and fundamental freedoms and, through these and other appropriate means, to draw public attention to those matters ..."
Do consumers have an interest in knowing about human rights violations that may be happening to workers involved in the production of products?

YES, they certainly do as this would affect their choices when it comes to products that they do purchase. It is not just the quality of substance used that concerns the consumer - but also the question of whether the said products have been made in a situation where human rights, worker rights, environment rights, etc have been respected and protected. If in the production, there have been violation of worker rights - like the use of slave or forced or child labour, then many consumers may elect not to support such violations of rights by not buying such products until and unless these violations are rectified...

Do investors have an interest in knowing about human rights violations that may be happening to workers involved in the production of products?

YES. Today, directly and indirectly individual persons invest in companies - by buying and owning shares, by buying unit trusts (which choose and buy shares in companies), through the employees provident fund (which also buys shares, bonds, etc...) - and whilst at one time the consideration was purely how much profits/revenue would one earn was the only consideration, today there is also concern about other aspects including human rights, worker rights, environment rights,...
It is because of this trend amongst consumers and investors that has resulted in the emergence of 'corporate social responsibility', something that most companies now advocate - and this not only cover the quality of products used in production but also a commitment to ensuring that worker rights, human rights and environment rights are not only recognized but also protected by these companies.

Some companies have progressed to not only tying themselves to these higher rights protecting standards but have also bound their suppliers and all companies/individuals in their supply chain right from the mining/harvesting of metals/products used in their production. Some have even developed comprehensive Code of Conducts themselves, or have bound themselves to Code of Conducts that covers sectors of production, like the Electronic Industry Code of Conduct. 

Today, even at the UN - we have a Special Representative of the Secretary General on the issue of human rights and transnational corporations and other business enterprises

What about people generally?
In a democratic society, where it is people that elect their government, as in Malaysia, certainly people have a legitimate right to know - because ultimately the very existence (and continued existence) of companies/businesses, including conditions relating to their existence in a country which today includes also how they respect human rights, environment and how they treat their workers are matters that are all aspects that any good government consider as important. If governments ignore human rights violations, then people would chose some other that will ensure that these rights are not only respected but also protected. Lynas, for example is a current case, where there is general dissatisfaction of the people about the earlier government approval for this rare earth company to operate in Malaysia, and there is much public outcry - and this, mind you, is an issue of future posibble risk to health and environment. 

What about the Federal Government, State government and Local Councils?
For any factory and business to operate, they need to get the permission and approval of not just the Federal Government but also the State government and the relevant Local Council. It is absurd for State governments and/or Local Council to even allege that they do not have any say in the matter...

Population by sex, ethnic group and age, Malaysia, 2010

What is the population in Malaysia? Well finally, I came across the government figures but there is a note that states, " Note: Population projections based on the 2000 Population Census" this may not be the current figures...but the title of the said table reads, Population by sex, ethnic group and age, Malaysia, 2010

Total Population :   28,908,795

Malaysian Citizens :- 26,784,965
Malay : 14,749,378 (55.06% of citizens)
Other Bumiputras:  3,197,993 (11.3%)
Chinese: 6,520,559 (24.34%)
Indian: 1,969,343 (7.35%)
Others: 347,692 (1.30%)

Non-Citizens : 2,123,830

3,147,409 (About 11.75% are above 55 years old)

Malaysia @ a Glance

2008 2009 2010
Area (km2) 330,803
Population (million)
Total 27.5 27.9 28.3
Male 14.0 14.2 14.4
Female 13.5 13.7 13.9
Average Annual Population Growth Rate (%) 1.3 1.3 1.3
Birth and Death ( per 1,000 population )
Crude Birth Rate 18.4 17.9 18.8
Crude Death Rate 4.7 4.8 4.9
Total Fertility Rate 2.3 2.3 2.4
Life Expectancy (years)
Male 71.6 71.7 71.7
Female 76.4 76.5 76.6
Gross Domestic Product (GDP)
GDP at current prices (RM million) 742,470 679,938 765,965
GDP at constant prices (RM million) 530,683 522,001 559,554

GDP Growth (%) 4.80 (1.60) 7.20
Labour Force ('000) 11,028.1 11,315.3 11,517.2

Employed ('000) 10,659.6 10,897.3 11,129.4
Unemployment ('000) 368.5 418.0 387.9

Labour Force Participation Rates, LFPR (%) 62.6 62.9 62.7

Unemployment Rate (%) 3.3 3.7 3.4
Producer Price Index (2005=100) 119.9 111.1 117.3
Consumer Price Index (2010=100) 97.7 98.3 100.0
Index of Industrial Production 108.1 99.9 107.3
External Trade (RM million)
Imports 519,804.3 434,669.8 529,194.6
00. Foods 27,969.3 26,732.1 30,263.9
01. Beverages and Tobacco 2,115.3 2,097.0 2,355.5
02. Crude Materials, Inedible 18,641.8 14,881.2 19,447.8
03. Mineral Fuels, Lubricants, and Other 56,804.3 35,688.2 52,690.8
04. Oils & Animal and Vegetable fats 5,219.0 4,977.6 7,208.9
05. Materials Chemistry 45,621.6 39,405.6 48,134.5
06. Manufactured Goods (including tin) 67,154.9 52,801.2 65,603.1
07. Machinery and Transport Equipment 254,283.0 222,364.1 261,590.1
08. Miscellaneous Manufactured Articles 28,628.9 25,817.6 31,959.4
09. Miscellaneous Transactions and Commodities 13,366.3 9,905.1 9,940.7
Exports 663,013.5 552,518.1 639,428.1
00. Foods 17,851.7 15,791.0 18,180.3
01. Beverages and Tobacco 2,431.4 2,476.6 2,815.2
02. Crude Materials, Inedible 17,694.4 13,157.1 19,125.4
03. Mineral Fuels, Lubricants, and Other 121,651.9 79,508.1 101,321.3
04. Oils & Animal and Vegetable fats 56,833.1 43,641.0 54,867.6
05. Materials Chemistry 39,486.1 33,263.4 40,735.6
06. Manufactured Goods (including tin) 59,150.8 49,356.4 56,391.9
07. Machinery and Transport Equipment 286,099.3 258,628.0 280,745.3
08. Miscellaneous Manufactured Articles 55,846.1 52,202.2 60,863.1
09. Miscellaneous Transactions and Commodities 5,968.5 4,494.2 4,382.5
Download  excel_birupdf_biru 
1. Population estimates based on the adjusted 2000 Population Census.
2. Crude Birth Rate, Crude Death Rate and Total Fertility Rate 2009 are preliminary data.
3. Crude Birth Rate, Crude Death Rate and Total Fertility Rate 2010 are estimated data .
4. Life expectancy 2008-2010 are estimated data.
5. The added total may differ due to rounding.
6. Group of classification for external trade product is based on the Standard International Trade Classification (SITC)
Source: Department of Statistics, Malaysia website

It should not be the ethnic or religious breakdowns of Malaysians that we should be concerned about  but the numbers of those who very poor....poor so that we can do something to ensure that there is more equity and justice in Malaysia...

With almost 12% of the Malaysian population over 55 years old - our concern must be for the welfare of the old folks....and, here must be the demand for FREE Universal Healthcare for all

Friday, May 20, 2011

Parasites of workers’ sweat and toil

Parasites of workers’ sweat and toil

More employers are now turning to labour outsourcing agents for workers, prompting Charles Hector to call for a restoration of a proper employer-employee relationship.

Workers’ rights in Malaysia are slowly being eroded by a government that places more importance on the well being of companies and corporations, rather than workers, be it local or foreign. One such phenomenon is the rise in the practice of workers being supplied to employers by outsourcing agents and companies, whereby the supplied workers do not enter into an employment relationship with employers that own and control the workplace. 

One wonders whether the usage of the term ‘outsourced’ was intentional as it is so easily taken to be all right as the practice of outsourcing work is now a common occurrence accepted generally. In Malaysia, for instance, most of the banks have already outsourced internet banking, phone banking and even cheque processing and clearance to other companies.

The material difference between outsourced work and outsourcing agents/companies is that the latter are dealing with human workers – not specific types of work. On the request of companies and owners that have factories, plantations, agricultural undertakings and other workplaces, outsourcing agents supply human workers, who then work at these workplaces without allegedly entering into any working relationship with the employers that own the place where they work. For the work done by these outsourced workers, the workplace owners would pay these outsourcing agents who in turn will pay the outsourced workers after of course keeping a portion for themselves. The more hours the workers toil, the more these outsourcing companies earn.

Private employment agencies and ‘outsourcing’ of labour companies
Private employment agencies and/or ‘head hunters’, who also do get workers and supply them to companies and owners of workplaces, are very different in that once the workers are accepted at the workplace, an employment relationship is entered into with the employers. The employment agencies get paid by the workers and/or the employers a certain fee, known as a placement fee. Private employment agencies are governed by the Private Employment Agencies Act 1981, and the fee that can be charged is also fixed. For a local placement, the fee is 20 per cent of the initial month’s pay, and for an overseas placement it is 25 per cent.

In contrast, ‘outsourcing’ agents and companies parasite on the fruits of the sweat and toil of these workers indefinitely. These workers at the workplace, doing usually the same work as all other workers in the factory, would also be naturally discriminated not only with regard to wages and other employment benefits guaranteed by Malaysian law, but also be deprived of the right to be members of unions that exist at these workplace. The negotiating power of the other workers and the local unions will thus be weakened when it comes to collective agreements.

Malaysian workers are also now victims of ‘outsourcing’ agents
For a long time, many Malaysians, apart from unions such as the MTUC, have not paid much attention to this development, which seeks to avoid employment relationship. It is an affront to justice, as it involves only foreign migrant workers. Today, many local workers, including those from Sabah and Sarawak, are also falling into this sub-class of workers,

Some companies have stopped direct employment preferring to get even local workers through outsourcing agents and companies in an attempt to avoid employment relationships.

Employment Act 1955 – historical victory for workers in Malaysia
In 1955, the then British administration saw fit to do away with all these kinds of bad employment practices and other forms of precarious employment, including indentured labour, bonded labour, the kanggani system, forced labour, ‘slavery’, the middle man (or ‘contractor for labour’) and this was a good thing for workers. The Employment Act 1955 also clearly established four very important principles in employment relationships in Malaysia:
  • Job security, including security of tenure until retirement age;
  • Legally guaranteed minimum worker rights, which included working hours, fully paid rest days, annual leave, public holidays, sick and hospitalisation leave, maternity leave, overtime rates, termination and lay-off benefits, and wages.
  • Due process to deal with worker misconduct and/or termination. Termination can only be by reason of just cause or excuse, and there has to be a domestic inquiry, where the worker has a right to be heard.
  • Access to justice, including the right to lodge complaints with the Labour Department (Labour Courts), and the Industrial Relations Department (Industrial Courts).
Return of bad employment practices to the detriment of workers
Over the past few years, slowly a new employment practice crept in: outsourcing agents and companies, who supply workers to different employers – individuals, businesses or companies – to work at the workplaces of these employers. Unlike the private employment agencies, these outsourcing agents and companies do not stop at just supplying the workers, collecting their placement fees and leaving, but continue to take significant portions of wages paid to these workers by the employers.

As an example, an employer may pay a remuneration of RM36 for the work done by a particular worker for nine hours. The outsourcing agents take RM16 and gives the workers only about RM20. The same happens with regard to overtime and Sunday or public holiday work payments. Just taking this RM16 per worker per normal day’s work, an outsourcing agent and company can make almost RM500,000 per month for 100 workers supplied. Some of these outsourcing agents and companies bring in thousands of workers and earn millions of ringgit living off the sweat and toil of workers. The employer, who does not consider these workers their own workers, would happily end up discriminating against these workers in terms of wages, work benefits and other worker rights.

Termination is also easily done, without the need for any due process. All that employers need to do is tell the outsourcing agent and company that they do not want worker A, and worker A will be taken away and another may be sent in their place. Generally, these workers only get paid for the days or hours that they work. They will not get the legally guaranteed workers’ rights, including paid rest days, paid annual leave, 10 paid public holidays per year, paid maternity leave and other benefits, and paid sick and hospitalisation leave.

Outsourcing agents’ practices are illegal
What is most disturbing is the fact that what is practised by these outsourcing agents and companies and their employers may be illegal under present laws in Malaysia, especially the laws with regard to employment.

These outsourcing agents and companies are really, what one would call ‘contractors for labour”. Our current Employment Act does not allow such ‘contractors for labour’. The current law, however, does allow for ‘sub-contractors for labour’, which is defined as “any person who contracts with a contractor or sub-contractor to supply the labour required for the execution of the whole or any part of any work which a contractor or sub-contractor has contracted to carry out for a principal or contractor, as the case may be.

The definition clearly does not include ‘contractor for labour’, and cannot legalise outsourcing agents (and/or the practices employed by them) and some employers today.

Government’s attempts to legalise outsourcing of labour companies thwarted

The Malaysian government finally came to a realisation and tried to legalise the ‘middle man’ in an employment relationship through D.R.25/2010 Employment (Amendment) Bill 2010, which was tabled in parliament in July 2010. The proposed amendments included a definition for ‘contractor for labour’ to mean a person who contracts with a principal, contractor or sub-contractor to supply the labour required for the execution of the whole or any part of any work which a contractor or sub-contractor has contracted to carry out for a principal or contractor, as the case may be.

But this time the Malaysian trade union movement and members of the public strongly protested the move and finally the government withdrew the bill in October 2010 (The Star,13 October 2010, ‘Employment Bill withdrawn’). This meant that what was acknowledged as being illegal is still illegal today.

In my opinion, the only Act that may assist matters is the Private Employment Agencies Act 1981. This means that once workers are supplied to employers, an employment relationship is created, and the employer is now responsible for all these workers, and will have to ensure that all rights and benefits recognised in law are provided to all these workers. One may want to consider this given the fact that we may now have over 200 ‘illegal’ outsourcing of labour companies in Malaysia.

Guarantee of equality in Malaysia extends also to workers

Article 8 of the Federal Constitution, which applies to all persons not just citizens, guarantees equality. This means that workers who do the same work are certainly entitled to the same wages and other work benefits as all other workers at the workplace. Note also that the Employment Act 1955 provides specifically that there should not be any discrimination based on whether one is a citizen or a foreign worker.

The past and better practice of employing foreign workers
Previously, when employers faced a shortage of workers, they needed to first seek the approval of the relevant body governing the particular sector. In the construction sector it was the Construction Industry Development Board(CIDB). The employer would have to satisfy the board that efforts have been made to get local workers and indicate the number of foreign workers that it would require to employ. Upon getting approval, the employer would start identifying and getting these foreign workers. For this purpose, they may use the services of agents in the country of origin and sometimes also agents in Malaysia. Some companies, would even go to the country of origin to conduct interviews and tests to ensure that the workers that they bring in have the necessary skills and aptitude for the work.

The contracts of employment will then usually be signed with the workers in the country of origin and then the process begins to obtain the required work pass/visa from the Malaysian immigration authorities, and then the workers are brought into Malaysia. Malaysia also imposes a levy that employers need to pay for every worker brought in, and the workers are also required to have a clean bill of health before they are allowed into country. In some countries, such as India, the government of India also gets involved through the Protector of Emigrants (POE), and a standard employment agreement is signed by the workers before an agent of the POE, while the employer signs the agreement in front of the staff of the Indian High Commission in Malaysia.

In short, under this system there was no ‘third party’ and when the workers arrived, they came as workers of the employer, and were entitled to all the protections accorded under Malaysian law for workers.

The legality of ‘fixed term contracts’ of employment is also questionable
With the advent of migrant workers into Malaysia, what also happened was the creation of a new employment relationship. This took the form of fixed-term contracts usually for a period of at least three years only – something that was really not permissible under the existing Employment Act 1955, which generally provided for employment until retirement. Earlier termination of the employment contract was only possible by resignation of the worker, lay-off/retrenchment and termination due to closure of the employer’s business or change in the manner of operations that made some workers redundant or due to termination after due inquiry into serious misconduct committed by the worker.

The employment laws have not yet been amended to provide for ‘fixed term contracts’, including clear remedies for earlier terminations of these fixed-term contracts. Even now, the lay-off and termination benefits provided for in our Employment Act looks at length of service as a factor in the calculation of benefits, a clear indication of the intention of the Act that the employment relationship should be until retirement. As such, for effective remedies, workers under fixed-term contract may have to look at laws outside existing employment laws, like the Contract Act for effective remedies, and their access to justice may have to be the civil courts.

Domestic workers and the emergence of recruitment agents
When the demand and need for domestic workers arose, it became impractical for employers to personally do all that was required for the employment of one or two domestic workers and they had to rely on licensed recruitment agents here in Malaysia. The same was the case when there was an increase in the number of smaller employers requiring just a few workers, usually in small shops and restaurants.

July 2005 – Government allows employment through ‘outsourcing’ concept
Then, suddenly in July 2005, the government decided to allow for the employment of workers through the outsourcing concept. But it must be pointed out that the government intended for these outsourcing companies to merely supply workers to employers, and not to become the employers of these workers.

Government never wanted the ‘outsourcing companies’ to be the employers
Deputy Prime Minister Muhyiddin Yassin clearly stated that “employers are the people who should be responsible for their foreign workers. Outsourcing companies are only responsible for bringing them in. After that, employers must assume full responsibility” (New Straits Times, 21 May 2010, ‘Higher levies for foreign workers’).

Clearly, what has been practised by outsourcing agents and companies, and employers is not only illegal, but also something that clearly goes against the intention of the Malaysian government. No employer can today escape an employment relationship with its workers by simply stating that these are not my workers but are those that are supplied by some ‘outsourcing’ agent or company. As employers, they are not only obligated to ensure that all workers’ rights are recognised and respected, but they also have to fulfil all obligations that the law places on the employers.

With regard to migrant workers, employers have the additional obligations of not only providing accommodation but also providing social security protection. Such protection will not just cover the workplace but the workers’ entire stay in the country. The Workmen’s Compensation (Foreign Workers’ Compensation Scheme) (Insurance) Order 1998 provided for additional benefits for not only death and personal injury sustained in an accident which arises out of and in the course of employment but also accidents that occur outside working hours. This is also clear indication that when it comes to migrant workers, the employer’s obligation to these workers’ welfare extends well beyond the workplace and working hours.

Poor enforcement and inadequate laws allowed injustice to continue
Poor enforcement and inadequacies in the present government’s administration are much to blame for this. All matters concerning workers and employment matters should rightly come under the Ministry of Human Resources. Today, when migrant workers claim their rights, employers can very easily just terminate them and immediately send them back to their home country. All that they need to do is go and tell the Immigration Department that they want to cancel the workers’ pass/visa, and the Immigration will do that without even talking to the migrant worker to find out whether they really want to leave before the end of their fixed-term contract or determining whether there are any outstanding labour issues, such as non-payment of wages and other claims/matters outstanding. They do not even check to determine whether there are any complaints lodged with the Labour Department, the police and/or the Human Rights Commission.

Sometimes, employers may just rush workers off to the airport and put them on board a plane back to their home country. The employers and/or their agents then go to the Immigration Department and say that the workers had gone back, and the Immigration Department happily cancels the visa/pass. A better practice would be that if workers are to be sent back especially before the expiry of their contract period, they should be personally interviewed by the Labour Department, using an interpreter. Such an interview should not be in the presence of their employer or agent and should establish that there are no outstanding unsettled claims and/or pending action, and if the Labour Officer is satisfied, he or she should issue and sign a certificate to that effect. .

Sadly, the Employment Act 1955 has no provision that makes it an offence for employers to discriminate against and/or terminate workers who have lodged complaints with the Labour Department, Industrial Relations Department, the police and/or the Malaysian Human Rights Commission. It is useless to have mechanisms for access to justice without the right laws to prevent employers from lodging complaints against workers for complaining.

Maybe the new Whistle Blowers Protection Act 2010 can be relied on, but it is best that the Employment laws are also amended to clearly prevent employers from acting against the interest of justice and making a mockery of existing laws.

Attempting to avoid the employment relationship a global phenomenon
The practice of trying to avoid the employment relationships and the duties and obligations that come with it are not just a phenomenon in Malaysia, but is happening worldwide. The international community frowns against such bad practices which affects worker rights, and even the International Labour Organisation (ILO) came up with a Resolution Concerning the Employment Relationship, and thereafter The Employment Relationship Recommendation No. 198. In 2007, ILO came out with a 75 page document entitled, “The Employment Relationship: An annotated guide to ILO Recommendation No. 198”

For a long time, it was only foreign migrant workers that were affected by the unjust practices of outsourcing agents and companies, and employers but today it also involves local Malaysian workers, many of whom are from Sabah and Sarawak. To be fair, some employers prefer to directly employ their migrant workers, which is still possible in Malaysia, but is becoming more difficult as some immigration officers are pushing them to go to the outsourcing agents/companies to get their workers.

Too many workers have been denied justice in Malaysia
This matter has never been brought to court because most affected workers then were mainly migrant workers, who were terminated and sent back would not be able to commence or even maintain action. Even if they had made complaints or commenced action, the complainants and/or the plaintiffs under the law are required to be in court for cases to proceed.

So many workers in Malaysia have been denied justice while violators of human rights and workers’ rights continue to prosper.

The government of the day and Malaysians should strive even harder to ensure justice for all in Malaysia, irrespective of whether they are citizens or foreigners, poor or rich. One thing that must be done immediately is to end the unjust practices of outsourcing agents and some bad employers.

Charles Hector, an Aliran member, is a human rights lawyer based in Pahang.