Unemployment-Related Benefits Systems

We consistently vindicate the abettance ardent to us by sundry crowd in this exploration purpose. Over specifically, we would love to rejoice Mr Ahmad Rasidi Hazizi, Consul-General of Malaysia in Hong Kong, Dato Zaninol Abidn Bin Abd. Rashid, General Secretary of the Ministry of Human Resources, Mr Shamsuddin Bardan, Executive Director of the Malaysian Employers Federation, Mr Zainal Rampak, President of the Malaysian Trades Union Congress and Dr William K. M. LEE, Associate Professor of Department of Politics & Sociology, Lingnan University.In detail, we would love to pointed our gratefulness to Prof Chang Chak Yan, Director of the Exploration Catalogue on Ethnicity and Overseas Chinese Economics, Lingnan University for his skin abettance. EXECUTIVE SUMMARY 1. There is no unencroachment refuge or unencroachment abettance plan absorbed to aiding the waste in Malaysia. The Congress is of the end that it has maintained a unifashion considerationing environment in Malaysia which has enabled Malaysia to consummate ample encroachment departed the deceased 1980s.Hence, there does not answer a demand to fir an unencroachment refuge or unencroachment abettance plan absorbed to aiding the waste in Malaysia. Akin well-entity avails in Malaysia comprehend felonious pay, avails for old age, unfitness, expiration, encroachment defective and undemonstrativeness. However, no currency abettance is made to the waste beneath the bearing machinations. Malaysia so runs a catalogue to excise indigence. Households which tolereprimand from indigence, whether or not it is objectd by unemployment, can use for abettance beneath the catalogue, theme to a means-test.This may ensure the basic demands of the waste but the catalogue is not unemployment-specific. 2. 3. 4. UNEMPLOYMENT-RELATED BENEFITS SYSTEMS IN MALAYSIA PART 1 - INTRODUCTION 1. Enhancement 1. 1 In October 1999, the Panel on Manpower and the Penal on Well-entity Services requested the Exploration and Library Services (RLS) Division of the Legislative Council (LegCo) Secretariat to precede a con-over on unemployment-akin avails plans. 2. 2. 1 Objectives and Design The objectives of the con-over are: ! ! ! o investigate the test of China, Taiwan, Malaysia, Malaysia, South Korea, the United Kingdom (UK), and the United States (US) in implementing their unemployment-akin avails plans; to sketch the exploration findings of the Organisation for Economic Co-operation and Development (OECD) and the Conventions and Recommendations of the International Labour Organisation (ILO) in unencroachment avails plans; and to bring-about an overall proportionately anatomy of the test in the overhead places in implementing their unemployment-akin avails plans, and con-over exoteric stipulations in aiding the waste in Hong Kong. .The design of the exploration, as agreed by the Panels, covers ! ! ! ! ! ! ! ! truthful development; main features and components; eligibility exactments; types of avails and amounts; period of reimbursement of avails; tax matter of the avails; object of investments for the avails; and congress of the unemployment-akin avails plans. Legislative Council Secretariat Unemployment-Related Benefits Systems in Malaysia 2. 3 In this fame, we centre on the test of Malaysia. Although Malaysia s a dissect dominion of the International Labour Organization, it has not ratified any of the three conventions of unencroachment avails1. 2. 4 This fame is dissect of the sequence of studies discussing unemploymentakin avails plans. There are 11 detached exploration fames (RP13/99-00 to RP23/99-00) on this theme. 2. 5 In this exploration, "unemployment-akin avails" respent to unencroachment avails and akin well-entity avails. Unencroachment avails comprehend unencroachment refuge and unencroachment abettance. Unencroachment avails are beneficial to the waste merely.In other tone, these avails are not beneficial to crowd who are not waste. The store must be exotericly waste, effectual to consummatement, voluntary to consummatement and looking for consummatement. Where there are no unencroachment avails or where these avails are mindless, well-entity avails may be made beneficial to arrange aid for those in demand. These akin well-entity avails, as defined in the 1996 OECD con-over of "avail plans and consummatement incentives", comprehend nobility avails, housing avails, cadet-care avails and gregarious abettance.They are made beneficial to all citizens theme to a means-test, and are not specifically targeted at the waste. 3. Methodology 3. 1 This con-over involves a concert of notification assemblage, erudition reend and anatomy. Requests for the certain notification feel so been obtained from the Malaysian Ministry of Gregarious Well-entity and National Unity, Ministry of Human Resources, the Malaysia Trades Union Congress (MTUC) and the Malaysian Employers Federation. This exploration fame is grounded on the notification obtained from these objects. . 2 In this fame, we use the 1999 mean diversify reprimand of RM1 = HK$2. 04 to transmute the Malaysian Ringgit into Hong Kong dollar. 2 1 2 Ensuring Avail or Allowances to the Involuntarily Waste Convention, 1934 (No. 44), Gregarious Security (Minimum Standards) Convention, 1952 (No. 102), and Encroachment Promotion and Refuge (Unemployment) Convention, 1988 (No. 168). Census and Statistics Department, Hong Kong Monthly Digest of Statistics, February 2000, p. 117. Exploration and Library Services Division page 2 Legislative Council SecretariatUnemployment-Related Benefits Systems in Malaysia PART 2 - UNEMPLOYMENT BENEFITS SYSTEM IN MALAYSIA 4. Enhancement 4. 1 In 1999, Malaysia had a population of 22 darling, of which nine darling were locomotive labour. The unencroachment reprimand ranged from 2. 4% to 3. 2% for the departed five years. The congress estimates the image to be 3% in 2000. There were 270 300 singles waste in 1999. Teffectual 1 shows unencroachment statistics of Malaysia for the departed five years. Teffectual 1 - Unencroachment in Malaysia 1995 Labour hardness ('000) Unencroachment Reprimand (%) Waste Individuals ('000) Source: 996 8 641. 4 2. 5 216. 0 1997 9 038. 2 2. 4 216. 9 1998 8 880. 9 3. 2 284. 1 1999 9 010. 0 3. 0 270. 3 8 256. 6 3. 1 256. 0 Economic Reports, Ministry of Finance, Malaysia 4. 2 The Malaysian Gross Domestic Product (GDP) development reprimands ranged from seven to nine percent in the departed ten years. The GDP at exoteric prices in 1999 was RM299. 68 billion (HK$611. 35 billion) space the per capita GDP was RM13,622 (HK$27,789). 5. Unencroachment Benefits Plan 5. 1 There is no unencroachment refuge or unencroachment abettance absorbed to aiding the waste in Malaysia. 5. The Congress is of the end that it has maintained a unifashion considerationing environment in Malaysia which has enabled Malaysia to consummate ample encroachment departed the deceased 1980s. Hence, there does not answer to be a demand to fir an unencroachment refuge or unencroachment abettance plan absorbed to aiding the waste in Malaysia. Exploration and Library Services Division page 3 Legislative Council Secretariat Unemployment-Related Benefits Systems in Malaysia PART 3 - WELFARE BENEFITS SYSTEM IN MALAYSIA 6. Felonious Pay 6. 1 In Malaysia twain the mistresss and the employees conceive felonious pay as a fashion of unemployment-akin avail. . 2 All consummatementers whose hues do not abound RM1,500 a month and all manual consummatementers irrespective of their hues are tried beneath the Encroachment Act 1955 which arranges for felonious pay. Felonious pay in Malaysia is notorious as curtailment avails, or fulfilment and lay-off avails, which are hired at the subjoined reprimands: ! 10 days stipend for each year of calling for encroachment shorter than two years; 15 days stipend for each year of calling for encroachment longer than two years but shorter than five years; and 20 days stipend for each year of calling for encroachment of five years or longer. ! ! 6. It is expected that the felonious pay would be suited to encounter the basic demands of an waste consummatementer until he finds the instant job. However, it should be eminent that felonious pay is not equipollent to unencroachment refuge or unencroachment abettance as defined in paragraph 2. 5 overhead. Reimbursement of felonious pay does not exact the mistress or the store employee to feel made foregoing offerings; neither does it exact the store employee to be effectual to consummatement, voluntary to consummatement and looking for consummatement in dispose to entertain reimbursement. Felonious pay is made to an employee solely on the reason of fulfilment of abbreviate by the mistress. . Employees Provident Investment 7. 1 This investment arranges avails for old age, unfitness and expiration. It so arranges dissects of the investment who feel savings in their accounts to pay for medical matter of fastidious indisposition or to pay for the medical matter of their coadjutor, conclusion and parents. However, it does not arrange currency abettance to any employee who is temporarily and involuntarily out of consummatement and who is looking for consummatement at the identical space. Details of the Employee Provident Investment are at Appendix I. Exploration and Library Services Division page 4 Legislative Council SecretariatUnemployment-Related Benefits Systems in Malaysia 8. Achievement Defective Refuge 8. 1 In Malaysia consummatement defective refuge is treated as a skin of encroachmentakin avail. The Gregarious Security Organization (or SOCSO), a statutory collection, administers reimbursement of avails beneath the Encroachment Defective Machination and Undemonstrativeness Pension Scheme. These machinations arrange avails to consummatementers in cases of encroachment defective and undemonstrativeness. Hence, although these two machinations are not unemployment-specific, an waste consummatementer who was damaged or who has befit feeble during his bestow departed encroachment may entertain avails beneath these machinations.Details of these two machinations are at Appendix II. 9. Services for the Scanty 9. 1 The Ministry of Gregarious Well-entity and National Unity runs a catalogue to succor indigence. Beneath the Destitute Idiosyncratic Act 1977, a nobility is categorized as scanty if the intimate monthly expiation of the nobility is near than RM460 (HK$938). Families who tolereprimand from indigence due to unemployment, amongst other objects such as old age, indisposition and unfitness, may use for abettance beneath this catalogue. According to beneficial statistics, the enumeobjurgate of crowd who would be categorized as scanty in Malaysia is encircling 5. % (1. 2 darling) out of the whole population of 22 darling. 9. 2 The indigence levigation catalogue arranges the subjoined abettance, which may be in currency or in skin: Teffectual 2 - Services for the Scanty Federal Machination ? ? ? ? ? ? ? ? ? Abettance for conclusion Abettance for the term-honored Expiation for the disabled consummatementers Launching grants Abettance for deceptive aids / spectacles Public abettance* School aids* Abettance to lad* (apprenticeship) Natural affliction aid ? ? ? ? State Scheme** Public abettance School aids Job luxuriance apprenticeship expiation Natural affliction aidRemarks: * ** Source: beneficial merely in Federal Territory of Kuala Lumpur exclude Federal Territory of Kuala Lumpur and Labuan Homepage of Ministry of Gregarious Well-entity and National Unity, Malaysia Exploration and Library Services Division page 5 Legislative Council Secretariat Unemployment-Related Benefits Systems in Malaysia 9. 3 We feel asked for details about the overhead catalogue but we feel been uneffectual to entertain a rejoinder from the Ministry of Gregarious Well-entity and National Unity as of the term of the proclamation of this fame.Research and Library Services Division page 6 Legislative Council Secretariat Unemployment-Related Benefits Systems in Malaysia PART 4 – PROPOSAL FOR A NATIONAL RETRENCHMENT SCHEME 10. 1 In February 1998 the Malaysian Trades Union Congress (MTUC) projected the firment of a National Curtailment Machination (NRS) to arrange avails to waste consummatementers who do not entertain any hire from their mistresss. This tender was made resisting the enhancement of half of the demands to felonious pay having been deprived in 1998 attributable to failure of the mistress. The projected NRS shows some characteristics of an unencroachment refuge machination, such as entity auxiliaryy in species, and delay qualifying stipulations on the eligibility of the stores and the period of reimbursement of avails. Reimbursement are elaboobjurgate as follows: ! Twain mistresss and employees are each to add RM1 (HK$2. 04) per month; Merely waste consummatementers can entertain avails subjoined having been waste for over than three months; An waste consummatementer may entertain the avails until he finds a new job; and Once a retrenched consummatementer entertains a job exhibit but refuses to sanction it, he would no longer be entitled to the avails. ! ! 10. 2 The Malaysian Employers Federation (MEF) irrelative the projected NRS owing it considered that the bestow congress arranged suited refuge to the waste and that it would be trickish for all mistresss to shoulder the misfortune of a few mistresss. In union, the MEF considered that the projected NRS would acception labour absorb, which in metamorphose would acception evolution absorb, and would intimidate considerationing in Malaysia. 10. 3 In present 1999, the Malaysian Cabinet directed the Ministry of Human Resources to con-over the practicable implementation of the NRS, reversing an precedent determination to repel the tender.Having completed the con-over in July 1999, the Ministry of Human Resources announced that the tender would be shelved for some space as the arrangement had shown signs of picking up and that there answered no impending demand to fir any unencroachment refuge machination. No ascertained determination has been made on the tender departed. Exploration and Library Services Division page 7 Legislative Council Secretariat Unemployment-Related Benefits Systems in Malaysia Appendix I Employees Provident Investment 1. Beneath the Employees Provident Investment (EPF) Act 1951, it is necessitated for all mistresss and employees to add towards this Fund.The mistress's offering is 12% and the employee's offering is 11% his monthly stipend. General supervision is by Ministry of Finance and address is by a tripartite superior Board, consisting of representatives of the mistress, the employee and the Government. Exemptions 2. The subjoined categories of consummatementers are exempted from the EPF Act: ! ! ! ! Expatriates; Domestic servants; Self-employed consummatementers (but can chosen to add); Out-workers (individuals who do cleaning, change recover consummatements, etc. ); Individuals detained in keeping, e. g. prisoners; Pensioners. ! ! Removal of EPF 3.Withdrawal of EPF can be made in indecent circumstances: ! Upon the expiration of a auxiliary, his nominee can bring-about a demand to EPF; Any auxiliary who attains the age of 55 years (old age avail); Any auxiliary who leaves the dominion persistently; Any auxiliary on medical postulates theme to eulogy by a medical consideration. ! ! ! Exploration and Library Services Division page 8 Legislative Council Secretariat Unemployment-Related Benefits Systems in Malaysia Qualifying stipulations for delaydrawal of EPF offerings 4. made: Indecent stipulations must be fulfilled anteriorly delaydrawal of the EPF can be !The auxiliary must feel addd to the EPF for at smallest five years; The primitive kind of old age avails, which is equipollent to 60% of his offering, cannot be delaydrawn until age 55; The relieve kind of housing avails, which is equipollent to 30% of his offering, can be delaydrawn for purposes of alienation of a primitive residential branch or a shopbranch cum residential unit; the counteract may be delaydrawn at age 50; The third kind of medical avails, which is equipollent to 10% of his offering, can be delaydrawn for medical purposes including fastidious indispositiones such as matter of cancer, courage problems, etc. pproved by the tripartite superior Board. ! ! ! Exploration and Library Services Division page 9 Legislative Council Secretariat Unemployment-Related Benefits Systems in Malaysia Appendix II Gregarious Security Organization (or SOCSO): Encroachment Defective Machination and Undemonstrativeness Pension Machination 1. The Gregarious Security Organization (SOCSO) Act 1969 exacts firms delay one or over employees whose single hues do not abound RM1,000 (HK$2,040) a month to record delay SOCSO. Exemptions !Any singles whose stipend abound RM2,000 a month but who has never been tried; Any idiosyncratic whose encroachment is of a fortuitous species and not for purposes of the industry; Domestic servants; Employees who feel attained the age of 55 years merely for purposes of undemonstrativeness but if they live to consummatement they should be tried beneath the Encroachment Defective Refuge Scheme; Foreign consummatementers; Congress servants; Self-employed. ! ! ! ! ! ! Qualifying Stipulations ! Minimum offering of 24 months. For those who feel made at smallest 12 monthly offerings, they are entitled to Undemonstrativeness Grant. Be near than 55 years of age at the space of undemonstrativeness or expiration.Invalidity must be strong by the Medical Consideration or Appeldeceased Medical Board. ! ! Exploration and Library Services Division page 10 Legislative Council Secretariat Unemployment-Related Benefits Systems in Malaysia Encroachment Defective Refuge Machination Offering Employer's offering Employee's offering Coverage Industrial accidents; Occupational diseases; Travelling accidents Benefits Temporary Avail Disablement 1. 25% of monthly wage Nil employee Undemonstrativeness Pension Machination 0. 5% of employee monthly wage 0. 5% of employee monthly wage Undemonstrativeness or expiration from whatever object Undemonstrativeness Pension Min. RM250 (HK$510)/month Max. RM1,268 (HK$2,587)/month (50% 65% of his mean monthly wage, depending on the whole enumeobjurgate of offerings) Min. RM10 (HK$20)/day, Max. RM52 (HK$106)/day Persistent Disablement Avail Min. RM10 (HK$20)/day; Max. 90% of the mean conducive daily wage Dependant's Avail Min. RM10 (HK$20)/day; Max. 90% of the mean conducive daily wage Survivor's Pension Min. RM250(HK$510)/month Max. RM1,268 (HK$2,587)/month (50% 65% of his mean monthly wage, depending on the whole enumeobjurgate of offerings) -- Exploration and Library Services Division page 11 Legislative Council SecretariatUnemployment-Related Benefits Systems in Malaysia Encroachment Defective Refuge Machination Medical Care According to Congress Hospital reprimands or SOCSO's Panel Clinic Funeral Avail Lump sum reimbursement of RM1,500 (HK$3,060) Constant-Attendance Expiation 40% of the daily reprimand of persistent whole disablement avail; max. RM500 (HK$1,020) Rehabilitation Avail Facilities for vocational and natural rehabilitation Education Avail A dependant cadet of an insured idiosyncratic receiving persistent Disablement avail/Dependant Benefit/Invalidity Pension/Survivor's Pension, beneath 21 years of age who is con-overing in a persomal state of remarkable learningInvalidity Pension Machination -- Funeral Avail Lump sum reimbursement of RM1,500 (HK$3,060) Constant-Attendance Expiation 40% of the daily reprimand of Undemonstrativeness Pension Max. RM500 (HK$1,020)/month Rehabilitation Avail Facilities for vocational and natural rehabilitation Education Avail A dependant cadet of an insured idiosyncratic receiving persistent Disablement avail/Dependant Benefit/Invalidity Pension/Survivor's Pension, beneath 21 years of age who is con-overing in a persomal state of remarkable learningSource: Ministry of Human Resources, Malaysia residence page at Exploration and Library Services Division page 12 Legislative Council Secretariat Unemployment-Related Benefits Systems in MalaysiaReferences Websites 1. 2. 3. http://www. kempadu. gov. my/ http://www. jaring. my/ http://www. mtuc. org. my/ Exploration and Library Services Division page 13