LETTER | MTUC welcomes the government providing RM122 million to Socso to implement the Employment Insurance System (EIS) in 2018.

We also thank the government for getting it passed in Parliament, and we believe there would not be any changes once it goes through to the Senate.

However, while the Bill is being is in the process of being passed, we must ensure that employers will not use EIS as an excuse to have rampant retrenchment at the workplace.  

We are concerned about the Socso CEO’s expectations of how the 57,282 who will be retrenched and will benefit from this scheme.

In normal circumstances, employers would notify the Labour Department at least 30 days prior to retrenchment, who will then go over the justification of the decision.

We are surprised that in this case, the Socso CEO has been notified by the Labour Department of the total estimated figure of those who will be retrenched in 2018.

The total of 57,282 workers who are expected to be retrenched is worrying to MTUC, since it does not correspond to the recent government announcement that our GDP being at 6.2 percent and that the economy of Malaysia is doing well.

Socso must also reconsider payouts to contract employees, as these worker are also contributing towards EIS.

Contract workers also have to look for new jobs when their contract expires. In this interim period, EIS should assist the worker, given that it is the intended purpose of the EIS.

As for the proposed RM600 per month for a maximum of three months, the figure is too low for an individual to survive, let alone one who is supporting an entire household.

We are uncertain on what basis Socso suggested the RM600 figure, when even the minimum wage of RM920 for Sabah and Sarawak, and RM1,000 in Peninsular Malaysia is insufficient.

We are aware that although the collection will be carried out in 2018, the government only intends to make the payouts in 2019.

However, with the collection minimum of RM50 million per month from both employer and employee, commencing in January 2018, and in addition to the contribution by the government for 2018, MTUC do not see any valid reason why the payout should not be on the basis of minimum wage, instead of RM600.

Though MTUC welcomes the payout, it must not be construed as a gift, but it must be genuinely seen as a reasonable amount for workers who are the beneficiaries, as they are also contributors to the EIS.

The views expressed here are those of the author/contributor and do not necessarily represent the views of Malaysiakini.