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September 1994, Volume 1, Number 8

Malaysia Proposes Fines for Employers Hiring Illegal Workers

Under the proposed Recruitment of Foreign Workers Act, employers could be fined up to RM 50,000 for each illegal worker employed, imprisoned for five years, or both. Currently, the Human Resources Ministry has no power to sanction employers who hire illegal immigrant workers; when the Labor Department learns of illegal workers, they are referred to the Immigration Department.

There are an estimated to be over 1 million illegal immigrants in Malaysia, including 800,000 Indonesians, 100,000 Filipinos, and 100,000 Bangladeshis. Between July 1992 and June 1994, 104,920 illegals were apprehended in Malaysia. Most are housed in one of eight detention centers--at a cost estimated at RM500,000 (US$200,000) monthly--and eventually deported.

One company has proposed handling, for a fee, all aspects of the recruitment of foreign workers, replacing the 822 licensed recruitment companies--300 of which are currently active. Some in government think that a single employment agency would reduce illegal immigration by fraudulent employment agencies.

A senior plantation leader lamented the alleged labor shortages on Malaysian plantations, and argued that increasing their dependence on foreign workers cannot solve the industry's problems because "foreign workers do not have the dedication or the discipline." Instead, he complained that plantations are being used only as an entry point for foreign workers who want to enter Malaysia's booming manufacturing sector.

However, the rubber manufacturers' association acknowledged that 25 percent of its unskilled workers are foreigners, and 11 percent of its skilled workers, and asked the government to clarify its foreign workers policy for factories.

Malaysia's largest company, Sime, has established the nation's first housing estate for foreign workers in Subang Jaya. At two workers per room, there will be housing for 1,443 workers, who will pay RM 5.10 ($2) daily. The housing is fenced and has 10 security guards on duty 24 hours a day. Identification cards are needed to enter the housing. Among the amenities are electricity from 7pm to 7am daily and tap water 24 hours a day.

In August, immigration police arrested several Chinese workers who had come to Malaysia as tourists and then gone to work in a furniture factory.


Roziana Hamsawi, Dhaka's Help Sought To Resolve Problem, Business Times (Malaysia) August 19, 1994; David Ong-Yeoh, "RM50,000 Fine for Bosses Hiring Illegal Alien Workers," Business Times (Malaysia), August 9, 1994. Business Times (Malaysia) August 1, 1994; Business Times (Malaysia) July 28, 1994, 20; Business Times (Malaysia) August 24, 1994.