MEF backs HR Ministry’s plan for direct foreign worker hiring to cut costs, boost transparency, and protect employers and workers in Malaysia.
PETALING JAYA: The Malaysian Employers Federation (MEF) has welcomed the Human Resources Ministry’s proposal to allow employers to directly hire foreign workers, saying the move could improve transparency and address long-standing recruitment challenges linked to high costs and worker exploitation.
MEF president Datuk Dr Syed Hussain Syed Husman said the initiative, aimed at reducing reliance on third-party agents, was a timely step towards strengthening labour governance and protecting the interests of both employers and workers.
“MEF appreciates the strong leadership shown by Human Resources Minister Datuk Seri R. Ramanan in addressing one of the most complex and persistent issues in foreign labour recruitment.
“The move to allow direct hiring is timely and necessary to address issues such as high recruitment costs, lack of transparency and risks of worker exploitation linked to intermediaries.”
Syed Hussain said MEF has consistently advocated for labour-related matters to be placed under the purview of the Human Resources Ministry, while immigration requirements remain with the Home Ministry.
He added that MEF expressed hope that the Cabinet would take into account employers’ operational realities and support the proposal to enable direct hiring.
He also highlighted that frequent policy changes over the years, often coinciding with shifts in ministerial leadership, have resulted in inconsistent hiring rules, creating uncertainty for employers, workers and foreign embassies in labour-sending countries.
“The policy shifts have made workforce planning difficult.
“Employers face uncertainty, workers are confused and foreign embassies struggle to manage expectations and compliance,” he said, adding that recruitment costs have also fluctuated due to the absence of a single, transparent framework.
The ministry said similar concerns have been raised during its engagements with foreign embassies, many of which have expressed support for a recruitment system that is more consistent, transparent and cost-effective.
“There is broad agreement on the need for a framework that reduces unnecessary costs, minimises reliance on intermediaries and ensures workers clearly understand and agree to their employment terms before arriving in Malaysia,” Syed Hussain said.
He emphasised that foreign labour continues to play a vital role in the economy, particularly in sectors in which local participation remains limited.
“As a developing economy, Malaysia requires foreign workers to meet the operational needs of key industries.
“This is an economic reality and businesses must be able to access labour in a lawful, ethical and predictable manner.”
In line with broader labour reforms, Syed Hussain also proposed simplifying the process for undocumented foreign workers to return to their home countries, describing it as a way to ease enforcement pressures while encouraging voluntary compliance.
“A clear and dignified return mechanism would benefit enforcement agencies and employers, while also addressing humanitarian considerations,” he said, reaffirming MEF’s commitment to fair treatment of all workers regardless of nationality.
He also expressed confidence that a government-to-government, technology-enabled recruitment model, including digital verification and secure payment systems, could strengthen Malaysia’s labour governance if implemented consistently and in close consultation with stakeholders.
