PETALING JAYA: The Electrical and Electronics Association of Malaysia (TEEAM) is strongly opposed to the recent enforcement of mandatory stamping for all employment contracts, warning that the policy could cause undue financial and administrative strain on small and medium enterprises (SMEs).
Reacting to reports on May 17 that all job contracts must now be stamped under the Stamp Act 1949, TEEAM said the move, while well-intentioned, overlooks practical implications for SMEs and risks undermining business efficiency, particularly in sectors that rely on speed and flexibility.
Acknowledging the government’s aim to strengthen legal protection for both employees and employers, TEEAM president Chang Yew Cheong said the blanket RM10 stamp duty per contract, regardless of employment duration or wage level, would disproportionately impact businesses employing large numbers of short-term or low-income workers.
“The cost may seem minor on a per-contract basis, but when applied across hundreds or thousands of contracts involving casual, contract and temporary workers, it becomes a significant burden.
“The added bureaucracy will also slow down hiring, hurt productivity and damage Malaysia’s global competitiveness.”
He said many SMEs are already grappling with rising operational costs, compliance obligations under the progressive wage policy, and the broader demands of post-pandemic economic recovery. The sudden implementation of the stamping rule, without stakeholder consultation or a phased rollout, could stall growth, reduce job creation and deter investment, he added.
TEEAM urged the Inland Revenue Board and Finance Ministry to suspend enforcement and initiate consultations with industry stakeholders. It is also calling for possible exemptions or streamlined procedures for smaller firms and specific job categories.
“We support fair labour practices and legal compliance, but such policies must be introduced with balance and foresight, especially given that SMEs form the backbone of our economy.”
Representing over 1,800 members in the electrical and electronics sector, TEEAM said it is ready for constructive dialogue to ensure that regulatory reforms safeguard both workers’ rights and business sustainability.
