Indonesian domestic worker hiring fee can drop to RM8K, agents to negotiate

 

The cost to hire Indonesian domestic workers can drop to as low as RM8,000 per person, depending on the business-to-business negotiating prowess of registered recruitment agencies from both countries, according to the republic’s top envoy to Malaysia.

“RM15,000 is the maximum fee agencies can charge an employer but if they can negotiate a better price with their Indonesian counterparts, we will not interfere, as long as they go through the legal channel,” the Indonesian Ambassador to Malaysia, Hermono, said.

Jakarta has agreed to revisit capping the fee at RM15,000, as proposed by Human Resources Minister V Sivakumar during his recent dialogue session with his Indonesian counterpart Ida Fauziyah.

Hermono, who goes by a single name, could not confirm if the maximum fee would be dropped but he gave his assurance that Jakarta would study the possibility.

The matter was raised again last month, during a two-day Joint Working Group (JWG) meeting between government representatives from the two countries.

Provisions that govern the role and functions of the JWG are included in the Memorandum of Understanding (MOU) for the Employment and Protection of Indonesian Domestic Workers in Malaysia, which was signed by both countries on April 1 last year.

Indonesian Ambassador to Malaysia, Hermono

The JWG was to meet regularly to tackle implementation problems and make consensual amendments to the MOU.

M'sian agencies advised to negotiate better rates

In this case, if Indonesia is able to revise the maximum fee of RM15,000, amendments would be made to the MOU to reflect the revision.

“Both sides have agreed to discuss with recruitment agencies in the respective country and bring back our findings to the next JWG meeting,” Hermono said.

However, he advised employers to urge their respective legitimate recruitment agencies in Malaysia to negotiate better rates.

“If Malaysian employers consider the cost of hiring Indonesian domestic workers too high, they can look to other source countries that offer lower fees.

“We hope that when the demand for Indonesian domestic workers drops, so will the price,” Hermono said.

A domestic worker at work

In reality, the demand for Indonesian domestic workers is unlikely to drop, and not from Malaysia.

Further, Hermono said, Indonesia is lifting an eight-year freeze on domestic worker placement in Saudi Arabia.

Down from RM25,000

Just last January, when Malaysia’s border remained closed to the entry of new migrant employees, the recruitment fee to hire domestic workers soared to as high as RM25,000.

However, confusion broke out when Immigration Department director-general Khairul Dzaimee Daud announced a rock-bottom estimation of RM1,136.

Immigration Department director-general Khairul Dzaimee Daud

Itemising this cost, Khairul said it covered charges for the levy, visa according to the source country, processing fee, employment pass payment, surety and a few other payments.

However, government-registered recruitment agencies busted that theory by factoring in unaccounted costs, which included costs of workers’ flight tickets and payments for their passports.

Just one month before the MOU was signed, capping the recruitment fee at RM15,000, the then deputy human resources minister Awang Hashim in the March 22 Parliament sitting said the maximum cost was RM7,800.

Without offering any itemisation of the costs that went into the hiring of domestic workers, Awang said only RM6,000 was to be paid by the Malaysian employers, while the other RM1,800 would be borne by the Indonesian side.

Malaysia is keen to push recruitment fees down and is in negotiations for a fee cap for domestic workers only from Indonesia. There is no fee cap for workers from other countries.

National Association of Human Resources (Pusma) president Zarina Ismail said the cost of recruiting Filipino domestic workers ranged between RM15,000 and RM16,500 per worker.

“There is no fee capping because they have a very strict recruitment process, which even the illegal agents in Malaysia cannot manipulate,” Zarina said, alluding that the recruitment fee cap will not stop workers from being cheated. - Mkini