Plantation associations oppose plantation sector inclusion in HRDF Act

The associations are Malaysian Palm Oil Association (MPOA), Malaysian Estate Owners’ Association (MEOA), Malayan Agricultural Producers Association (MAPA), Malaysian Employers’ Federation (MEF), Sarawak Oil Palm Plantation Owners Association (SOPPOA) and Palm Oil Millers Association (POMA).

Also voicing their opposition are Palm Oil Refiners Association of Malaysia (PORAM), Malaysian Oleochemical Manufacturers Group (MOMG), Malayan Edible Oil Manufacturers’ Association (MEOMA), Malaysian Biodiesel Association (MBA), Incorporated Society of Planters (ISP) and Sabah Employers Consultative Association (SECA).

In a joint statement today, the associations said the act, which entailed having to pay one per cent for an HRDF levy, is not suitable and does not benefit the sector which is heavily dependent on foreign workers.

It said the associations are appealing for a waiver of contribution for a further period of at least 12 months to allow for an inclusive and effective engagement with the relevant stakeholders of the plantation sector and the government.

“Such engagements will constructively facilitate towards an open and transparent platform to review the additional levy made under the expansion of the compulsory HRDF Order 2021.

“In doing so, this will be a testimony to the government’s objective to attain win-win propositions in inclusive partnership with the private sectors towards reviving the Malaysian economy in post-pandemic recovery period,” the statement said.

It said the associations appealed to the Minister of Human Resources to expedite and facilitate an engagement between the ministry officials and industry representatives towards formulating win-win propositions pertaining to the plantation sector’s contribution to the HRDF levy.

“The associations also appeal to the Minister of Plantation Industries and Commodities to recognise and appreciate the plight of the industry under his care and take up the matter directly with the Minister of Human Resources,” it said.

It said counter proposals could involve considerations for the employers in the plantation sector to opt for optional and voluntary contributions of a lower HRDF levy threshold.

“If the training programmes structured and offered are deemed effective and useful, the associations believe more employers will be encouraged to participate,” it said.

It said the associations further proposed that companies specifically in the palm oil downstream industry be given the option to voluntarily contribute and/or contribute at a lower levy of 0.5 per cent.

“This is taking into consideration of slower sales and exports during this COVID-19 pandemic and companies would appreciate the extra funds be channelled towards covering their business overheads,” it said.

It added that HRDF should work closely with the relevant associations in drawing up and structuring the training programmes that could be more relevant and effective for the eventual contributors.

The plantation sector was exempted for the last 28 years by the government since the act was promulgated on Jan 1, 1993.

In reviews held between the plantation sector and the authorities in 1992, 1999, 2011 and 2018, the Ministry of Human Resources concluded that the HRDF programme was not suitable for the plantation sector thus, exempting the plantation industry from the HRDF Act.