In the service sector, it is the responsibility of the employer to submit the application on behalf of the foreigner and see that the Work Permit is obtained. Work Permits are issued only to workers who meet the specific conditions and requirements prescribed for the particular sector. Employers on their part are also expected to meet a few sector-specific conditions before a Work Permit can be issued to the worker on whose behalf the employer is applying.
Approved Source Countries/Territories
Foreigners belonging to the following countries are eligible to apply for Work Pass in the construction sector: Malaysia, People's Republic of China, North Asian Sources (NAS): Macau, Hong Kong, South Korea and Taiwan.
Quota Restrictions in Employing Foreigners (Dependency Ceiling/Quota)
As far as the manufacturing sector is concerned, it is mandatory for the employers to employ 25% of the workforce coming under the skilled workforce category and 40% overall. The limit for workers coming from PRC is 8% of the total number of foreigners employed by the establishment.
Activities coming under the Services Sector
Here are the types of activities under which employers can apply for Work Permit for the Services Sector:
- Real estate, finance, and insurance and other business services
- Communication, logistics, storage services
- Commerce comprising retail and wholesale trade
- Community, social and personal services (does not include domestic workers)
- Hospitality (Hotel) industry
- Restaurants, Delis, coffee shops, food courts, and other approved food establishments
- Dispatch and delivery services
- Hairdressing and beauty salons
- Foreign workers do not have the permission to be employed in food stalls or hawker stalls
- Food shop establishments employing foreign workers need to have NEA (National Environmental Agency) licences
- Employers are permitted to assign multiple tasks to their employees under the Job Flexibility Scheme ( a food and beverage staff may be deployed to man the front desk)
Foreign Worker Levy
The company that is in the services sector needs to restrict the number of foreigners as employees in the prescribed ratio, and also need to pay a Foreign Worker Levy for every worker in their employment. The amount of Levy is not fixed and will depend on the qualifications of the worker hired and the current ceiling/quota applicable to the manufacturing sector.
In certain cases the employers may be required to execute a Levy Bond as prescribed by the Ministry of Manpower (MOM)
- All employers whose workers' permits are cancelled due to non payment of Levy need to execute a Levy bond.
- Employers who do not pay levy fees on time, or those who default payments at least thrice in a 12 month period.
- Whenever there is change in ownership of a sole proprietorship concern.
Important steps to be followed while applying for Work Permit
Employers who are applying for Work Permit for workers originating from India, Sri Lanka, Thailand, Bangladesh, The Republic of the Union of Myanmar, People's Republic of China need to make the following applications and need to get prior approval before submitting application for Work Permit:
- Man Year Entitlement (MYE) to confirm eligibility
- Prior Approval (PA) as and when required
- In-Principle Approval (IPA) for each Work Permit
- Purchase of Security Bonds
As far as MYE and PA are concerned, they won't be required unless the Work Permit is applied on behalf of foreigners from Malaysia, Hong Kong, Macau, South Korea and Taiwan because an In-Principle Approval is sufficient for workers from these countries.
Note for Employers:
Employers cannot bring in non-Malaysian foreigners into the country before applying for the Work Permit.