EIS Bill passed in bipartisan vote after Parliament clock stopped

The Dewan Rakyat unanimously passed the Employment Insurance System (EIS) Bill 2017 in a marathon sitting that went past midnight.

The House, which began sitting at 10am, stopped its clock to allow the session to continue past midnight. The bill was debated from 7pm.

BN MPs, together with opposition lawmakers from PKR, DAP, PAS and PSM who participated in the debate, supported the bill. Bersatu and Warisan did not debate the bill.

The EIS will create a fund, pooled from employers and employees, which will provide compensation for up to six months to workers who are retrenched.

Prior to the vote, opposition lawmakers made several attempts to introduce what they claimed were improvements to the bill.

During the third reading, which is the committee stage, Charles Santiago (DAP-Klang) mooted an amendment to the bill where the government will also contribute to the EIS.

His motion, however, was rejected by the House.

Human Resources Minister Richard Riot said the government does not need to contribute to the scheme as it had already allocated RM120 million in the interim fund.

"Since the government spent a huge sum of money in the scheme, among others, there is no need for it to pay," he said.

Charles had also debated that the compensation of up to six months was not enough and should be increased to a year. He claimed six months was not enough to retrain a retrenched worker.

He added the scheme should also cover the spouse of someone who is retrenched.

During the debate, Shamsul Iskandar Md Akin (PKR-Bukit Katil) too supported the bill but wanted the government to ensure that it will be an effective mechanism of social safety net.

He also urged the government to consider allowing employees terminated on disciplinary grounds to also draw from the fund, pointing out that they too are contributors.

Dr Michael Jeyakumar Devaraj (PSM-Sg Siput) said a retrenched worker will only receive an equivalent of 2.7 months' wages as compensation over a period of six months under the EIS.

"While under Employment Act, a worker who had worked for 10 years will be entitled to seven months wages compensation.

"So, the compensation provided under EIS is not much....EIS, however, is a good start. We just need to widen (the quantum of compensation)," he said.

Responding to these arguments, the minister in his reply said research had shown that a retrenched worker can be retrained within six months.

He added that including the spouse of a retrenched worker in the EIS may leave it open to abuse, such as business owners hiring their spouses as workers and later retrenching them to receive benefits.

Riot also pointed out that the 0.2 percent contribution rate is the lowest in the region, as Thailand and Vietnam have set their contribution rate at 1.25 percent and three percent respectively.

The sitting adjourned at 12.15am.

The EIS bill, which was retracted on Monday and re-tabled the next day, lowered the contribution rate to be paid by employer and employee from 0.5 percent to 0.2 percent.

The revised contributions, which were based on a fixed rate, will range from 10 sen for workers earning RM30 monthly, to RM39.50 for employees earning RM4,000 and above a month.

The system will be managed by the Social Security Organisation (Socso). The bill is scheduled to come into effect on Jan 1, 2018, while payouts will begin in 2019. -Mkini