DAP calls for clarification on proposed amendment to termination benefits regulations

by Parliamentary Opposition Leader, DAP Secretary-General and MP for Kota Melaka, Lim Kit Siang, in Petaling Jaya on Friday, April 29, 1983:

DAP calls for clarification on proposed amendment to termination benefits regulations.

The Labour Minister, Datuk Mak Hon Kam, said at the inaugural meeting of the Electricity Industry Employers’ Association yesterday that the government was gazetting an amendment to Regulation 8 of the Employment (Termination and Lay-Off Benefits) Regulation to disallow workers to opt for payment of termination benefits following a change of ownership of their firm if the new owners offer them employment on terms and conditions no less favourable than existing ones.

It is evident from the announcement that the new employer would not be required to offer similar terms of employment to all existing workers, but could choose and pick. There is a danger that this might be abused by employers to retrench certain portions of their work force, by way of a change of legal ownership, whether for purposes of restructuring of the work force or for other reason, which would be inimical to the interests of the workers.

Secondly, it is not clear what the Labour Minister means by ‘terms and conditions no less favourable than existing ones’. Does this apply merely to salary and working conditions, or it is extended to all the rights that a worker accrues because of his length of service, such as continuity of length of service in the previous firm for purposes of computation of gratuity, annual leave, etc.

Before the new amendment to the Employment (Termination and Lay-Off Benefit) Regulation is gazetted, the Labour Minister should make public the draft regulation for comment and reaction from both employers and workers. As the government talks so much about the concept of Malaysia Inc. on the close rapport and working relationship between the government, employers and labour, the Labour Minister must set the example of securing consensus and fullest consultation before amendment of labour laws or regulations.

In this connection, I find it rather odd that the Labour Minister should be inaugurating an Electrical Industry Employers’ Association, when the Government is now advocating in-house unions. Or does the Labour Minister mean that employers from an industry can unite, but not the workers in the same industry.

It cannot escape notice that in matters affecting employers, the Ministry of Labour can act with unusual speed. But in matters which affect workers, the Labour Ministry cannot get out of its snail-pace movement. A good example is the long-standing scandal of the SOCSO benefits, where for the first ten years from 1971 to 1980, SOCSO collected $243 million in contributions but only paid out benefits worth $17 million to workers injured in industrial accidents and $6.5 million in medical expenses. The Labour Minister should explain why the Labour Ministry applies such double standards to problems of employers and of workers.