Observation (CEACR) - adopted 2011, published 101st ILC session (2012)

Equality of Treatment (Accident Compensation) Convention, 1925 (No. 19) - Malaysia - Peninsular (Ratification: 1957)

Follow-up to the conclusions of the Committee on the Application of Standards (International Labour Conference, 100th Session, June 2011)

Article 1(1) of the Convention. Equal treatment of foreign workers. The Committee recalls that since 1 April 1993, the Malaysian social security system has contained inequalities of treatment that run counter to the provisions of the Convention. This inequality is due to national legislation that transferred foreign workers, employed in Malaysia for up to five years from the Employees’ Social Security Scheme (ESS), which provided for periodical payments to victims of industrial accidents, to the Workmen’s Compensation Scheme (WCS), which guaranteed only a lump sum payment of a significantly lower amount. On several occasions, the case of Malaysia has been discussed by the Conference Committee on the Application of Standards. Most recently, in June 2011, the Conference Committee urged the Government to take immediate steps in order to bring national law and practice into conformity with Article 1 of the Convention, to respect the system of automatic reciprocity instituted by the Convention between the ratifying countries, and to avail itself of the technical assistance of the ILO to resolve administrative difficulties by concluding special arrangements with the labour-supplying countries under Articles 1(2) and 4 of the Convention.

In its report received in August 2011, the Government replied that it is considering bringing its national law and practice into conformity with Article 1 of the Convention. A technical Committee including all stakeholders will be formed under the Ministry of Human Resources to pursue the formulation of the right mechanism and system to administer this issue considering the following three options: (i) extension of ESS coverage to foreign workers; (ii) creation of a special scheme for foreign workers under the ESS; and (iii) raising the level of the benefit provided by the WCS so as to be equivalent to that of the ESS benefit. Upon completion of the study by the technical Committee, the Government will consider engaging technical assistance of the ILO to facilitate bringing the national legislation in compliance with the principle of equality of treatment between nationals and non-nationals.

The Committee notes that an ILO mission visiting the country from 3 to 7 October 2011, was briefed on action being taken to rectify the situation. The Committee also notes the comparative tables supplied by the Government with its report, listing in detail the characteristics of both the WCS and the ESS with respect to qualifying conditions, conditions for the granting of benefits and the calculation formulas used to compute benefits. It notes that there are considerable differences in the levels of benefits granted by the WCS and ESS, as illustrated by the fact that the WCS does not grant invalidity pensions in case of permanent total invalidity and that the WCS benefit in case of permanent partial disability represents only 6.5 per cent of the ESS benefit. The Committee hopes that in determining the most suitable option among those mentioned above, the Government will act with the best interests of migrant workers in mind and will treat them on an equal footing with Malaysian workers. The Committee trusts that the Government will accomplish this task in the very near future so as to be able to report success in its next report to be supplied by 1 September 2012.

[The Government is asked to reply in detail to the present comments in 2012.]