KUALA LUMPUR: Companies in the manufacturing sector will continue to be exempted from a 80:20 employment requirement ratio until the multi-tier levy mechanism (MTLM) is fully implemented.
The Ministry of Investment, Trade, and Industry (MITI) said this extension provides flexibility for industries to adjust their workforce requirements more flexibly, without compromising the government's goal of reducing dependence on foreign workers.
The extension was made taking into account various factors and feedback from the industry sector.
Human Resources Minister Steven Sim in response to a parliamentary question in December said, the multi-tier levy mechanism (MTLM) for all sectors, except plantation and agriculture, will be effective Jan 1, 2025.
"MITI will continue to focus on enhancing the skills of local workers as a key step to ensure that the local workforce can compete in an increasingly high-tech global economy. "This skill enhancement aims to provide more capable workers who can contribute to dignified income and drive sustainable economic growth," it said in a statement today.
Meanwhile, MITI also noted that it will continue to work with the industry to ensure the manufacturing sector can continue to grow sustainably and contribute to the country's economic growth.
During the 2025 Budget presentation, the Prime Minister announced that the government would implement MTLM early next year to encourage automation and reduce dependence on foreign workers gradually.
For the manufacturing sector, MTLM will replace the 80:20 policy stipulated in the manufacturing license conditions.
The government also announced that levies collected would be channeled back to the industry.
It will be used to increase the use of technology and automation, improve productivity, reduce dependence on foreign workers, thereby contributing to Malaysia's increased competitiveness globally.