FMM In The News: THE EDGE MALAYSIA, May 9, 2025
KUALA LUMPUR (May 9): The Federation of Malaysian Manufacturers (FMM), which represents over 13,000 companies in Malaysia's manufacturing supply chain, lauded the government's decision to permit the transfer of foreign workers across different industries as a timely and pragmatic solution to address labour imbalances in the local economy.
"This is a timely and pragmatic move, especially given the ongoing freeze on new foreign worker recruitment. The policy has the potential to help rebalance the distribution of labour across sectors, enabling companies with surplus workers to release them to sectors experiencing acute shortages, including manufacturing," FMM president Tan Sri Soh Thian Lai said in a statement Friday.
This comes after Home Minister Datuk Seri Saifuddin Nasution Ismail announced on Thursday the government's decision after a joint committee meeting on the management of foreign workers, which he co-chaired with Human Resources Minister Steven Sim Chee Keong.
Saifuddin said this approach aligns with best practices recommended by international labour organisations and has already been adopted by other developed countries.
The government previously only allowed foreign workers to switch employers within the same sector, subject to conditions such as company restructuring, closure, expansion or approval by a committee overseen by the Labour Department.
"FMM also supports the policy announcement on allowing applications on a case-by-case basis for the manufacturing sector, particularly to replace workers who have exited employment. This flexibility will assist in maintaining continuity of operations and minimising disruption to production activities," Soh said.
It is also important to ensure the implementation of this new policy adheres to both regulatory requirements and ethical workforce management principles, he said.
Worker consent a must
To this end, FMM called for the Immigration Department to directly and centrally manage the intersectoral transfer process to maintain consistency, prevent abuse and ensure timely approvals.
The federation, which is looking forward to continued engagement with the government to finalise operational guidelines, also made a few other recommendations:
- Portability of levy payments — Employers, FMM said, should be allowed to transfer the levy already paid to the new employer. Alternatively, the new employer should only be required to pay the difference in levy if the rates vary between sectors, to ensure financial fairness and prevent "double burden" on employers.
- Digitised processing and end-to-end transparency — The FMM recommends that as much of the process as possible be conducted online through a digitised system that includes status tracking, audit trails and clearly defined approval timelines. This would significantly reduce administrative burdens and support effective compliance monitoring.
- Worker consent and safeguards — All transfers must be based on the informed consent of the worker, free from any form of coercion, and properly documented, said FMM. It also called for the establishment of a clear mechanism to address any grievances or disputes that may arise from such transfers.
- Database integration for labour matching — FMM suggested that the MyFutureJobs platform be leveraged as a national clearinghouse to match surplus and demand across sectors. It suggested that employers seeking or releasing workers be encouraged to update this database, which will promote transparency and reduce reliance on intermediaries.
"The success of this policy will depend on a balanced approach that meets both national workforce policy objectives and real-world operational needs of employers, while upholding the rights and welfare of the workers involved," added FMM.