Wednesday, June 4, 2008

Do Not Abuse VSS, Minister Warns Firms

RAWANG: Human Resources Minister Datuk Dr S. Subramaniam has warned companies not to use voluntary separation schemes (VSS) to replace staff with foreign workers.

He said this defeated the actual purpose of employing the VSS to remove redundancies, reduce operational overheads, restructure the company and remain competitive.

Subramaniam added that companies were entitled to carry out the VSS in good faith as per Section 63 of the Employment Act, 1955, by giving one month's notice to his ministry.

"However, companies cannot offer VSS and then simultaneously outsource for contractors or hire foreign workers.

"In fact, companies should consider the loyalty of long-serving staff and not opt to terminate their services just because they earned higher wages compared to new staff, especially foreigners."

He added that companies that hired foreign workers as replacements were duty-bound to notify his ministry as per Section 60K of the act in two weeks.

Those who failed to do so could be charged under Section 99A of the act, and if convicted could be fined a maxium of RM10,000.

"I have directed my officers to investigate companies which flout this law," he said after a visit to Lafarge Malayan Cement's Rawang plant.

To protect workers' welfare, Subramaniam said his ministry had come up with several guidelines to minimise VSS. These included:

- freezing employment for new workers, except for critical cases;
- limiting overtime and work on rest days and public holidays; and
- identifying alternative tasks for under-worked staff.

On the unhappiness of the transport industry in the implementation of the Human Resource Development Fund (HDRF), Subramaniam said it was for the benefit of workers.

"We want to ensure that the money deducted from the workers' wages is reinvested for their long-term human resource development," he said.

"In an ever-competitive world, we want a continually trained workforce to keep with the times.

"Subramanian added that without legislation, some companies only partially used the funds for their workers' benefit despite deducting the wages.

By Adrian David
NST Online 4 June 2008

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