NCCIM seeks longer grace period for businesses to comply with Act 446

KUALA LUMPUR (Feb 21): The National Chamber of Commerce and Industry of Malaysia (NCCIM) has criticized the government over the “untimely use” of Act 446 to ensure employers provide proper accommodation and amenities for workers, saying it adds unnecessary burden and costs to businesses struggling during the pandemic.

The chamber, in a statement today, said Putrajaya should give employers a longer grace period to comply with Act 446, which refers to the Emergency Ordinance (Workers’ Minimum Standards of Housing and Amenities Act).

The Act, which was gazetted on Feb 17, allows the Human Resources Ministry to delegate the enforcement of the new law to other ministries, and imposes stiffer penalties (fines up to RM200,000 or jail terms of up to three years or both) against employers or owners of accommodation for failing to provide proper housing facilities for workers.

Employers who are unable to comply with Act 446 will have to house their employees in temporary accommodation (centralised labour quarters) approved by the Labour Department and in hotels registered with Ministry of Tourism, Arts and Culture.

“These arrangements will cost RM270 per month per worker (RM200 for accommodation, RM20 for utilities and RM50 for transportation),” said NCCIM president Tan Sri Ter Leong Yap.

He said that the wider empowerment of enforcement to other ministries would cause uneasiness among businesses on worry about the objectivity and consistency of enforcing the Act.

“More worrisome is that businesses were perturbed by the use of Emergency Ordinance (EO) for the enforcement of Act 446, as it has stirred businesses’ and investors’ fear and concern that the EO may be used for other regulations and laws that could undermine the already weak investor’s confidence and anxiety about the duration of the state of Emergency,” he added.

Ter expressed the hope that the EO will be carefully managed and implemented fairly to avoid undermining investors’ confidence and private investment prospects.

“During the emergency implementation period, the most critical considerations should be effective communication and dissemination of information.

“In this regard, the government’s regular engagement with industry is essential prior to the implementation of public policy and decree of new ordinance, so as to minimize disruption to businesses,” he said.

While it agrees that the Act is a step in the right direction, NCCIM said the government must adopt an educational approach on employers in various sectors and allow for a longer grace period for those to comply.

It suggested a 12-month grace period till end December for employers to register with the Labour Department to apply for the Certificate of Accommodation.

“The extension can serve to provide more time for the department to engage with businesses and industries, especially SMEs, through collaboration with the chambers and industry associations to educate and enhance businesses’/employers’ awareness about the importance of ensuring a liveable condition for foreign workers,” said Ter.

Source: TheEdgeMarkets