There has been no information on key aspects like the specific timeframe for implementation, who exactly would be covered under this rule, the contribution rates for both employers and foreign employees or how the phased rollout will be managed,

 he said in a statement.  

Soh said the mandatory contributions for foreign workers would affect the operating costs and cash flow of employers, adding that this was an additional burden on top of the upcoming new RM1,700 minimum wage and multi-tier levy system.  

He believed the existing social safety net system for migrant workers offered sufficient protection, while EPF’s purpose of retirement savings did not align with the short-term nature of the employment of migrant workers.  

He also said employers could not afford to make EPF contributions for migrant workers at the same 12%-13% rate that they do for Malaysian employees.  

With 2.5 million foreign workers in the country, the EPF contribution on non-citizens would translate to an additional minimum annual payroll cost of RM6.6 billion,

 he said, also citing the minimum wage and a 13% contribution rate as an example.  

The former president of the National Chamber of Commerce and Industry of Malaysia added that migrant workers may not be keen about contributing to EPF since it would reduce their take-home pay, the bulk of which is sent to their families back home.  

In announcing the budget last week, Prime Minister Anwar Ibrahim said the government had agreed to make it mandatory for foreign workers to contribute to EPF, adding this would be done in phases.