KUALA LUMPUR: Nearly one in five Malaysian workers is not covered by the safety net from the Social Security Organisation (Perkeso).

Data gathered through Perkeso's enforcement operations revealed that between 17 and 20 per cent of employers have yet to register their workers for the work protection schemes.

"This means that in any random inspection, nearly one in every five workers is without workplace accident coverage due to employers' non-compliance," said Perkeso group chief executive officer Datuk Seri Dr Mohammed Azman Aziz Mohammed.

He added that although there was no data on the number of unregistered workers, Perkeso currently had 10.05 million active employees in its records.

Featured Videos

The number comprised Malaysian and foreign workers in the private sector, as well as contract and temporary workers in the civil service.

But that figure is about 2.5 million short of the total 12.56 million employees (Malaysian, foreign and contract civil service workers) reported by the Statistics Department in May.

Non-compliance among Malaysian employers, said Azman, was rampant in the hospitality, food and beverage (F&B), manufacturing, wholesale and retail sectors.

He said 17,482 summonses or compound notices had been issued to errant employers from 2022 to this year.

The organisation, he said, had collected RM3,937,555 in fines since 2020, with modern technologies available, employers should not trifle with their contributions.

Azman said Perkeso could employ data-matching, smart analytics and cross-agency collaborations to detect irregularities or missing contributions by employers trying to dodge their responsibilities.

The organisation also conducted routine and targeted inspections, as well as special operations, besides following up on complaints and whistleblower reports.

"Typically, an initial review is conducted within three to seven working days upon receiving a complaint.

"Depending on complexity, most cases are resolved within 30 days.

"However, if legal action is required, such as taking the employer to court, the process may take longer due to legal procedures and timelines," he said, adding that while Perkeso treated all complaints equally, cases involving a larger group of workers might be prioritised due to their wider impact.

In the case of foreign workers, Azman said Perkeso was still determining the latest compliance rate among employers, pending cross-data validation with the Immigration Department.

Azman said estimating the number of unregistered foreign workers was challenging due to constant new entries, renewals, repatriations and database discrepancies, but Perkeso was working to improve its data alignment with relevant agencies.

A key measure included integrating its system with the Immigration Department to require employers to register their foreign workers for workplace coverage before work permits were issued by the latter.

"This proactive approach aims to ensure that all eligible foreign workers are covered under Malaysia's social protection system from the outset of employment," he said.

Azman said industries with the highest non-compliance rates in registering foreign workers were construction, plantation and agriculture, manufacturing, and services such as cleaning, hospitality and security.

"These industries often rely heavily on foreign labour, including contract or casual workers, which can contribute to under-registration and non-compliance," he said.

Azman said many employers cited ignorance or confusion of the process for not registering their foreign workers.

"They assume that coverage under a private insurance scheme is sufficient or perceive that foreign workers are temporary or short-term hires and thus, not required to register.

"Cost-related concerns, administrative oversight or failure to update employment records are also factors of non-compliance," he said.

To address this, Perkeso had intensified enforcement in high-risk industries with the Labour and Immigration Departments, besides running multilingual awareness campaigns and engaging industry groups to drive compliance.

It provides advisory support to help employers, especially small and medium-scale enterprises, resolve technical barriers in registration.

It is also integrating its MYFutureJobs database with the Immigration Department's Expatriate Pass Application System to identify unregistered foreign workers based on work permit issuances and job placements.