The HRDF levy is a mandatory levy payment collected by the Human Resources Development Fund (HRDF, also known as PSMB) imposed on employers from all industries. The purpose is to enable employee training and skills upgrading of the Malaysian workforce.
The companies and employers under the first schedule of the PMSB need to enlist their employees under the HRDF. There are various sectors in the list, like the mining and quarrying sector, the manufacturing sector, and the service sectors. If you are an employer under any of these categories and have failed to register with the PMSB, you are liable to RM 10,000 penalty and even a jail term of one year. There was an amendment to the Act in 2017. There is much technical jargon involved, but the basic summary comes up to this:
– All the employers under the program need to enroll at least 10 of their employees in the program. The levy paid by these companies would be equal to the one percent of their Malaysian employees’ monthly wages.
– All the employers under the first schedule who were employing five to nine local workforce were eligible for voluntary registration instead of compulsory. They need to pay the levy at a rate of 0.5% of each Malaysian employees’ total monthly wage.
Employers can get financial aid from the HRDF for conducting their training programs. For getting the benefits, however, there is a procedure. The SBL is the primary scheme under the HRDF, and it encourages employers to conduct their training programs and train their employees.
From 1 March 2021, access to HRDF is expanded to all industries. Firms with 10 or more local employees are obligated to register, while firms with 5 to 9 local employees have the option to register.
Any employer who is required to register but has not registered with HRDF could be fined up to RM10,000 and/or face imprisonment of up to a year.
The companies and employers under the first schedule of the PMSB need to enlist their employees under the HRDF. There are various sectors in the list, like the mining and quarrying sector, the manufacturing sector, and the service sectors. If you are an employer under any of these categories and have failed to register with the PMSB, you are liable to RM 10,000 penalty and even a jail term of one year. There was an amendment to the Act in 2017. There is much technical jargon involved, but the basic summary comes up to this:
– All the employers under the program need to enroll at least 10 of their employees in the program. The levy paid by these companies would be equal to the one percent of their Malaysian employees’ monthly wages.
– All the employers under the first schedule who were employing five to nine local workforce were eligible for voluntary registration instead of compulsory. They need to pay the levy at a rate of 0.5% of each Malaysian employees’ total monthly wage.
For a more comprehensive understanding, please check out the HRDCrop FAQ for obtaining additional information.
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