1. Monitoring Sustainability of Globalisation (MSN), Malaysia
PROCURE IT
Pathma Krishnan
Monitoring Sustainability of Globalisation (MSN), Malaysia

2. Agenda Introduction to Malaysia’s E&E sector
Infrastructure of Migration
State Migrant Policies on Migrant Workers
Field Studies
Conclusion

3. Introduction to Malaysia’s E&E sector
1972: First semiconductor plant in Penang
1970s: 577 employees with 4 companies
Now, they have more than 1500 companies with more than 600, 000 employees
Total investment of RM 108 billion (USD billion)
2008: Overall export valued at RM billion (USD 75.4 billion)

4. Infrastructure of Migration
Malaysia is a recipient of various communities in Asia
It is both a receiving and sending country
In the last 18 years, there has been substantial increase in regular and irregular migration into the country
2007: Malaysia recorded 72.7% increase in migrant labor
2010: 2 million registered regular & 1 million irregular migrants

5. Migrant flow- receiving country

6. Selection Of factories and profile
Two major Electronic Manufacturing Services (EMS): Jabil Circuit and Flextronics
JABIL: 15 Fortune 500 company
Designs, test, manufacturers ODM and OEM
Clients: Cisco System, HP, Echostar, Nokia, Gateway 2000 and others
Malaysia : About 5000 over employees, both local and outsourced migrant workers

7. Continued FLEXTRONICS : Asia Pacific HQ in Singapore
Global in 30 countries, 4 continents
Electronic Manufactures Service (EMS)
Clients: Dell, Microsoft, Motorolla, Palm, HP, Xerox and others
Employees : About 7000 and more; locals and outsourced migrant workers

8. Structure of interviews
Questionnaire agreed by WEED and Monitoring Sustainability of Globalisation (MSN)
Incorporating ILO Co Labor Standards and Codes (EICC)
46 workers interviewed: 26 from Jabil and 20 from Flextronics with translators
Nationality: Nepalese, Bangladesh, Indonesians, Cambodians, Burmese, and Vietnamese
Interviews of workers: July 12th and 13th and July 23rd and 24th. At Dormitories and outside dormitories

9. Regular versus Irregular migrants
Regular Worker
Irregular Worker
versus
Agency unknown
Licensed agency; Legal placement fee
Passed relevant skills test
Skills set unknown
Medical examination completed
No medical examination
Approved employment contract
No legal contract
Unknown pre departure preparation
Required pre departure completed

10. State migrant Policies
Malaysia manages migrants from law and order and security perspective
Policy measures; work permit, levy, bilateral agreements, memorandum of understanding (MOU)
Policy measures needed to monitor and eliminate irregular migration;
Biometric security system
Detention camps
Punishment of whipping
Amnesty
Special security operations

11. State migrant Policies
Policy instruments
Legal Instruments
Immigration Act 1959/ 1963: Controls related entry and departure
Immigration Regulations 1963 Sect 9(3): Work permit only valid in particular employment; not transferable
Employment Act 1955: Apply equal employment opportunity to all workers.
Passport Act 1966
Mandatory medical examination
Sect 8(3) of the Immigration Act
Mandatory medical examination which includes HIV, Hepatitis and pregnancy at selected entry points
Yearly pregnancy test required
Immigration Act 1959/1963: controls related entry & departure; Entry permit and Work permit
Immigration Regulation: Sect 9(3) Immigration Regulation and Employment (Restriction); work permit only valid in the particular employment
Work permit is not transferable.
Employment Act 1955: Apply equal employment opportunity to all workers. However, in practice, Malaysian law treats migrants workers differently
Passport Act

12. Field studies Key findings
Passport withholdings/ Incidents of bonded labor
Non payment of wages and/or illegal deductions/ withholdings
Contract substitution/ Breach of contract
Exorbitant recruitment/ Placement fee
Unsafe and poor living and working conditions
Lack of redress mechanisms/ No right to association

13. Physical and verbal harassment
Higher medical expenses
Threat of imprisonment and forcible deportation from labor brokers
Lack of pre departure/ skills training
No effective monitoring system for labor brokers
Lack of protection under national law

14. Case studies
“Om, 20 years, Nepal, we paid RM170 for accommodation deposit and we were asked to sleep at the dormitory corridors for nearly a week” (worker outsourced to Jabil)
Abdul 19, Bangladesh, I was verbally abused, slapped and threatened to be deported because my wages were not paid (4 months) by the labor agent…” (worker outsourced to Flextronics
“We had to prostitute ourselves to survive for two months because we did not have work…”
(Female workers from Nepal)

15. Passport Withholding/ Incidents of bonded labor
Workers are forced to sign a blank form/ consent form
Deposit required to return passport to the holder (RM500 to RM 3000; USD 166 to USD 1000)
Non payment of wages and/or illegal deductions/ withholdings
Late payment
Non payment/ Higher Debt
Discipline wages
Utilities deduction
Accommodation deduction
Forced savings deductions
Contract substitution/ Breach of contract
Terms and conditions of receiving and sending countries differ
Contract written in English- A language most migrants do not understand/ speak

16. Exorbitant recruitment/ placement fee
Above legal limit
Anywhere between RM2400 to RM 10000(USD 800 to USD 3400 approx.); depending on nationality
Unsafe and poor living and working conditions
About sq ft., 12 to 15 people occupy
One bath, one toilet
No mattresses, no fan
Health and safety hazards - electrical wiring etc.
Lack of redress mechanisms
The laws of the country do not provide for special complaint or redress mechanisms
Increasing headcounts of workers instead or rights protection
Sending country more interested in incoming remittances

17. No right to association
The contract prohibits any association/ to join trade union in Malaysia
Physical and verbal harassment
By labor brokers
At work (supervisors, local workers – language barrier)
Higher medical expenses
Workers have to bear expenses above amount stipulated in contract
Threat of imprisonment and forcible deportation from labor brokers
Police, RELA and labor brokers

18. Lack of pre departure/ skills training
Inadequate training
Misleading information
Language barrier
No effective monitoring system for labor brokers
Poor enforcement in Malaysia
Suppliers not managing labor brokers effectively
Lack of protection under national law
The lack of effective regulation and enforcement within the country
Labor workers treated as commodities

19. Conclusion/ recommendation
Government, MNCs, Stakeholders must hold recruiting agents/ outsourcing companies accountable for any violations of migrant workers.
Adjust code of conduct to include protection for migrant workers
Training and audit for suppliers
Most importantly, to make purchasing decision based on ethical treatment of migrant workers