In fact, I was even involved in various aspects of the business of foreign workers, starting with the provision of insurance cover for the guest workers. At one time, I even had management control over two employment agencies licensed to recruit foreign workers but gave up when it was obvious that a dirty game would only get dirtier.
Those were the days before China and India woke up. It was a time when MNCs in labor intensive sectors like the electronics and textile industries were seeking solutions to escalating labor cost in their own countries and found Malaysia an attractive location for factories both in terms of infrastructure and tax considerations. It was the heyday of Mahathirism and nothing must stop his industrialization juggernaut; least of all an acute shortage of cheap, unskilled local labor. Getting orders to supply workers was and is never the problem per se. It is how one gets into a position to offer and deliver the service that counts.
It was, and I believe still is, a "technical know-who" game where rules and regulations are mere formalities to shut out those who are not within the circle at the top of the food chain. This is an industry so perfect for the rent-seeking scourge of NEP Malaysia that it could not be better even if it was by design; or was it? There are more "toll gates" than the North-South highway!
If it is any indication, this 16th July1995 NST report about the infamous Tajuddin Rahman of Pasir Salak speaks volumes. Tajuddin of course denied all allegations.
The main operative mechanism that drives this rent-seekers' gravy train is the quota system which is supposed to be regulative. Supposed to be.
Each stage in the employment of a foreign worker is fraught with palms to grease or lined with gold depending on where one is positioned. But ultimately it is the poor sod who hocked everything he had (or did not have) in his homeland who pays the price.
Moreover, there is an off-shoot to this legal employment of foreign workers; the illegal workers. The thousands of desperate runaways or illegal entrants create rent opportunities for "below the line" authorities and it is by no means small change.
Najib in unveiling Part 1 of his New Economic Model mentioned decreasing dependence on unskilled foreign workers. As a deputy PM before, he would have chaired the Cabinet Committee on Foreign Workers (yes, there has been this special cabinet committee for years now) and he would know the A-Z of the stats and issues. Unless, he has the will to impose a realistic minimum wage policy in the country he can forget about reducing dependence on foreign workers. I wonder how one of his 3 main goals of the NEM i.e. a high-income society (US15,000 to US20,000 per capita by 2020) dovetails with all this.
I could write volumes about foreign workers in Malaysia from a close-up view going back two decades yet it seems my knowledge would not be outdated even today because judging from the following article in the Malaysian Insider today some things just do not change. Please read:
The legal flesh trade
SUBANG, March 31 — In meetings with industrialists, businessmen, associations and trade unions in Selangor, conversations are laden with innuendos about the “foreign worker industry.”
Most of the claims are conjecture, or at best, educated guesses based on the experience of having to navigate through the jungle of red tape and fees that one has to pay to hire foreigners.
Yet these collective anecdotes and patterns speak of a hidden industry behind the official economy.
Where the laws are loose, enforcement is non-existent and where there is an unwritten understanding between the clients, agents and the government officials who are supposed to regulate it.
Oh yes, it is worth hundreds of millions of ringgit, most of it unaccounted for in official government records.
Make no mistake. There’s money to be made in foreign workers and despite well-intentioned noises from politicians about how “businesses need to shed their addiction to them”, there is very little will to kick the habit.
Most of the claims are conjecture, or at best, educated guesses based on the experience of having to navigate through the jungle of red tape and fees that one has to pay to hire foreigners.
Yet these collective anecdotes and patterns speak of a hidden industry behind the official economy.
Where the laws are loose, enforcement is non-existent and where there is an unwritten understanding between the clients, agents and the government officials who are supposed to regulate it.
Oh yes, it is worth hundreds of millions of ringgit, most of it unaccounted for in official government records.
Make no mistake. There’s money to be made in foreign workers and despite well-intentioned noises from politicians about how “businesses need to shed their addiction to them”, there is very little will to kick the habit.
An executive, who declined to be quoted, explained that a couple of years ago, the rules were that a foreigner could work as an unskilled general worker for up to five years. At the end that, they could apply to be unskilled workers for six years.
“Now, you have to send that worker back to his home country after five years. You can only bring him back after six months. Think about it. With the previous rule, you only had to pay once to bring him here and he could stay for 10 years.
“Now you have to send him back after five years and you have
to pay again to bring him back,” says the executive.
Since it’s near impossible these days to staff a factory entirely with locals, companies have no choice but to re-hire the same foreigners or look for others.
“Either way, you still have to pay (to bring in a foreigner) but with the new rules you have to pay an agent twice. Get it?” the executive says with a knowing arch of his eyebrows.
In situations where there is a low supply of foreigners and a great need from companies — like with the current freeze on new permits — agents will often offer their “stock” to the highest bidder.
The executive explained that this is still happening even though the government recently approved 100,000 new permits to bring in foreigners.
Then there are the fees these agents will charge the workers themselves in their home countries.
The highest is supposedly paid by Bangladeshi workers, who pay up to RM10,000 to work in Malaysia.
“So an agent makan dua kali (takes a cut from both sides). From the employer and the worker. Now, how do you think this is allowed?”
Last month, Prime Minister Datuk Seri Najib Razak revealed that there were 30,000 Indian nationals who enter on social visit passes but who have since disappeared.
Veteran trade unionist G. Rajasekaran has an answer for that.
G. Rajasekaran says the MTUC is supposed to help Malaysian workers but they have been forced to step in because of the wide-scale exploitation of foreign workers. — Picture by Choo Choy May
“Agents bring them in on social visit passes. The workers don’t know that these passes expire in a few months. By the time they realise it, they know they are in trouble.
“They can’t go to the authorities because they’ll get arrested and deported. So they just bear with it. Bite their tongue work as much as they can, leave Malaysia and never come back.”
Despite a flood of negative press in countries like India, Bangladesh and Nepal about how exploited their citizens are in Malaysia, these workers still keep coming.
“The workers you see here are from very remote villages. They’re not from the Mumbai or Dhaka. They are naïve,” says Rajasekaran, secretary-general of the Malaysian Trade Union Congress (MTUC).
Though the body is supposed to represent Malaysian workers in the private sector, it has now also become a voice for exploited foreign workers.
Often foreign workers approach him and MTUC for help in getting back wages owed to them by irresponsible employers.
The abuse of migrant workers here has even caught international attention with human rights group Amnesty International recently reporting that it “is widespread and happens in every sector of employment.”
The most unpleasant development in this grey industry these days is agents who act as a labour providers, a practice Rajasekaran describes as “legalised human trafficking.”
The government had issued 270 licences for agents to bring in general labourers who are not placed with a factory, plantation or business. They are instead owned by the agents and “rented out” on a daily basis to companies who need them, says Rajasekaran.
“The agent will probably charge the company RM100 per worker per day but would only pay the worker RM50.
“So the company does not need to provide medical coverage, overtime or anything else beyond paying the daily wage to the agent.”
There is virtually no oversight as to whether these workers are treated well by the agent, whether they are fed or whether they are paid the wage that was promised to them.
“From the reports that we get, these workers often live in horrible conditions and when they complain, they are beaten by the agents. They can’t seek help from the authorities because the agents hold their passports.”
“Tell me, is this not like legalised pimping?”
G. Rajasekaran says the MTUC is supposed to help Malaysian workers but they have been forced to step in because of the wide-scale exploitation of foreign workers. — Picture by Choo Choy May
“Agents bring them in on social visit passes. The workers don’t know that these passes expire in a few months. By the time they realise it, they know they are in trouble.
“They can’t go to the authorities because they’ll get arrested and deported. So they just bear with it. Bite their tongue work as much as they can, leave Malaysia and never come back.”
Despite a flood of negative press in countries like India, Bangladesh and Nepal about how exploited their citizens are in Malaysia, these workers still keep coming.
“The workers you see here are from very remote villages. They’re not from the Mumbai or Dhaka. They are naïve,” says Rajasekaran, secretary-general of the Malaysian Trade Union Congress (MTUC).
Though the body is supposed to represent Malaysian workers in the private sector, it has now also become a voice for exploited foreign workers.
Often foreign workers approach him and MTUC for help in getting back wages owed to them by irresponsible employers.
The abuse of migrant workers here has even caught international attention with human rights group Amnesty International recently reporting that it “is widespread and happens in every sector of employment.”
The most unpleasant development in this grey industry these days is agents who act as a labour providers, a practice Rajasekaran describes as “legalised human trafficking.”
The government had issued 270 licences for agents to bring in general labourers who are not placed with a factory, plantation or business. They are instead owned by the agents and “rented out” on a daily basis to companies who need them, says Rajasekaran.
“The agent will probably charge the company RM100 per worker per day but would only pay the worker RM50.
“So the company does not need to provide medical coverage, overtime or anything else beyond paying the daily wage to the agent.”
There is virtually no oversight as to whether these workers are treated well by the agent, whether they are fed or whether they are paid the wage that was promised to them.
“From the reports that we get, these workers often live in horrible conditions and when they complain, they are beaten by the agents. They can’t seek help from the authorities because the agents hold their passports.”
“Tell me, is this not like legalised pimping?”
