KUALA LUMPUR, Oct 24 — The initially proposed contribution rates for both employers and employees have now been halved under the amended Employment Insurance System (EIS) Bill today.
The Human Resource Ministry has now halved the amount in its amended Bill, to five cents each, for those earning not more than RM30, and RM7.90 for employers and employees respectively, for wages exceeding RM4,000.
Minister Datuk Seri Richard Riot Jaem tabled the fresh Bill for the first reading in the Dewan Rakyat today, after withdrawing the one submitted on August 1.
Under the previous draft, contribution for employers and employees started at 10 cents each, for monthly wages of not more than RM30, and RM19.75 for both parties for those wages exceeding RM4,000.
The EIS Bill will now also have four contribution rate schedules, which may be reviewed triennially, at the discretion of the government.
The proposed law would also establish an Employment Insurance Committee, which would advice Social Security Organisation (Socso) on matters related to the EIS and the type of investment to be made, from monies raised from the said insurance.
The Bill applies to all industries, for employees with one or more employers. However, it bars spouses of employers, civil servants from both the federal and state governments as well as domestic helps including house maids, cooks and drivers from the insurance coverage.
The EIS seeks to extend welfare coverage for the country’s 6.5 million private workers by compelling employers to contribute additional payment and bar them from making cuts to wages and fixed perks.
It is primarily aimed at helping provide financial assistance to private workers who lost their jobs until they find new employment.
Retrenched workers will also be given help to search for new jobs, career counselling and training.
Prime Minister Datuk Seri Najib Razak had announced on May 1 that the government has agreed to provide the Social Security Organisation with RM70 million for the payment of financial benefits relating to the EIS from next year.
Employers who violate the rule and are found guilty can be punished with a jail term of up to two years and fined a maximum RM10,000.