The group’s spokesman, Faizal Aziddin, said Section 50(3) of the Employees Provident Fund Act allowed EPF to “compensate” contributors whose monthly deductions are not remitted by their employers.
The section says that if an employer fails to pay any contribution which has been deducted from the employee’s wages, the board shall credit the employee with the amount along with any dividend which would have been credited.
It also says that nothing in this section shall prejudice the right of the board to recover the amount of such contributions and dividends from the employer.
Faizal said the section stipulates that the board could take an amount equivalent to the defaulted payments from EPF’s general fund and credit it into a member’s account.
He said as the law was vague on the defaulting period before EPF enforcement, the “compensation” could be done “at any time”.
“According to records we have seen, some have not been settled from as far back as 2019.
“It’s already been about five years and I think it’s long enough for EPF to invoke the act,” Faizal, a former SAS general manager, told FMT.
SAS landed in trouble when the Malaysian Aviation Commission (Mavcom) did not renew its air service permit, required for its commercial operations, after it lapsed on Feb 29.
On March 12, meanwhile, the Civil Aviation Authority of Malaysia (CAAM) suspended its air operations certificate for 90 days. On Wednesday, CAAM extended the suspension to July 31.
Last week, FMT reported that SAS had failed to remit more than RM5 million in deducted contributions to the EPF. In a letter to SAS, the fund warned of legal action if it failed to submit the contributions.
It is understood that the company’s financial status is among the main reasons for Mavcom’s action.
On Wednesday, the group called for SAS to be slapped with the appropriate penalties for breaching labour laws by failing to pay its employees on time. It also urged the ministries to prevent such instances from occurring again.
Faizal, representing the 68 employees who had signed a petition against SAS, said the EPF was the only savings they had for their retirement.
“If the government does not step in to resolve this, they will face much hardship.”
The petition has been submitted to the transport and human resources ministries.