Tenaganita executive director Glorene Das said while it is encouraging that the government is working to improve foreign workers’ social security, it is equally crucial to implement robust monitoring systems to ensure that deductions from foreign workers’ salaries are channelled to the pension fund as required.
“We have encountered cases in the 2000s where contributions were either delayed or not (remitted to EPF) at all, leaving workers vulnerable,” Das told FMT.
“Therefore, establishing transparent mechanisms that ensure accountability are vital, not only during the contribution process but also when workers eventually withdraw their savings upon retirement or departure from Malaysia.
“Tenaganita’s long-standing work with foreign workers has demonstrated that providing comprehensive social protection not only enhances workers’ well-being, but also improves productivity and economic growth.”
Das said the proposed policy will strengthen Malaysia’s commitment to improving labour rights and close the gap in social protection between local and foreign workers, which is in line with international norms.
Currently, foreign workers can voluntarily opt to contribute to the EPF at a rate of either 11% for those aged below 60, or 5.5% for the rest. Employers contribute only RM5 under both schemes.
Tabling the 2025 budget last Friday, Prime Minister Anwar Ibrahim said the government planned to make it compulsory for all foreign workers to contribute to EPF, with the proposal set to be implemented in phases.
In a statement on Monday, EPF said the move is expected to benefit two million foreign workers in the country, with mechanisms still being put together to mandate foreign workers’ contributions to the fund.
Another rights activist, North-South Initiative executive director Adrian Pereira, agreed that the proposal must be accompanied by robust enforcement measures to ensure that foreign workers receive their due benefits.
He suggested that foreign workers be taught how to access their EPF accounts online to verify whether their employers’ contributions and their own deductions are being deposited as required each month.
“There should be an alert in the system when the payments are not made. There is enough software and technology to do that,” he said.
Pereira also emphasised the need for educational and awareness programmes to help foreign workers better understand the importance of financial literacy and retirement planning, especially since some may have low literacy levels.
He said employers can no longer justify hiring foreign workers instead of Malaysians by citing the lack of mandatory EPF contributions.