More benefits in place foreign migrant workers
Foreign workers, expatriates and domestic workers can now receive benefits under SOCSO’s Invalidity Scheme.
Foreign workers in Malaysia will benefit from SOCSO’s Invalidity Scheme, providing them with 24-hour protection and covering funeral repatriation costs starting 1st July 2024. The announcement was made by Human Resources Minister Steven Sim in May, aiming to enhance protections for all foreign workers, including expatriates and domestic workers employed in the country.
However, the extension of benefits comes with increased costs for employers and foreign workers. Industry estimates suggest that these costs could exceed RM140 million annually for employers alone. SOCSO’’s CEO, Datuk Seri Dr Mohammed Azman Aziz Mohammed, emphasized that these contributions should be seen as investments rather than mere expenses. They ensure crucial protection and benefits for workers, promoting their well-being and security in times of need.
Dr Mohammed Azman also highlighted that prior to this extension, SOCSO was reimbursing up to RM4,500 for repatriating bodies of foreign workers in non-employment related deaths. This cost is now covered under the Invalidity Scheme in accordance with international labor standards and government objectives.
The scheme includes 24-hour protection and complements the existing Employment Injury Scheme, which previously covered only work-related injuries. Foreign workers must meet a minimum contribution requirement of 24 months to qualify for benefits like Invalidity Pension or Survivor’s Pension.
Employers and foreign workers are required to contribute to SOCSO for this scheme, although employers can opt for additional private insurance if needed, as required by other authorities such as the Health Ministry’s Health Insurance Scheme for Foreign Workers.
President of the Malaysian Employers Federation, Datuk Dr Syed Hussain Syed Husman, welcomed the move despite the added financial burden, noting that it would enhance Malaysia’s standing in the treatment of migrant workers internationally. Meanwhile, the Federation of Malaysian Manufacturers projected a 0.5% increase in monthly wages due to higher SOCSO contributions, estimating an annual additional cost of RM144 million across 1.6 million migrant workers earning minimum wages.
Overall, while this extension signifies a step forward in inclusive social protection, it poses challenges for businesses adjusting to greater financial responsibilities and potentially reconsidering their reliance on foreign labor.
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