Human Resources Development Fund Malaysia - Ministry of Human Resources, Malaysia MOVING FORWARD - HRDF

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Human Resources Development Fund Malaysia - Ministry of Human Resources, Malaysia MOVING FORWARD - HRDF
“PEOPLE, PROWESS, PROGRESS”

Human Resources Development Fund Malaysia
      Ministry of Human Resources, Malaysia

               MOVING FORWARD
Human Resources Development Fund Malaysia - Ministry of Human Resources, Malaysia MOVING FORWARD - HRDF
PRESENTATION OUTLINE
    • About HRDF
1

    • HRDF Coverage Effective 1st April 2017
2

    • Registration Benefits
3

    •Q & A
4
Human Resources Development Fund Malaysia - Ministry of Human Resources, Malaysia MOVING FORWARD - HRDF
ABOUT HRDF

             www.hrdf.com.my
Human Resources Development Fund Malaysia - Ministry of Human Resources, Malaysia MOVING FORWARD - HRDF
About HRDF : Vision, Mission and Values

                                      VALUES                     VISION
                                                                                          MISSION
                                                         To be the human capital
                                                        development authority in        Spearheading the human
                                                       strengthening the economic         capital learning and
                                                        development of Malaysia     development through strategic
                                      Customer Focus                                   interventions that fulfil the
    Accountability                                                                  current and future needs of the
                                                                                                 industry
                               Integrity
                  Continuous
                 Improvement

         The
    Establishment
        & The
     Milestones

PEOPLE I PROWESS I PROGRESS                                                                                www.hrdf.com.my
Human Resources Development Fund Malaysia - Ministry of Human Resources, Malaysia MOVING FORWARD - HRDF
About HRDF : PSMB Act 2001
                                              Section 3
                                      To encourage employers
                                          covered under the
                                       Pembangunan Sumber
                                     Manusia Berhad Act 2001 to
                                    retrain and upgrade the skills
                                          of their employees,
                                   apprentices and trainees in line                Section 4
                                    with their business’ needs and
                                    the development strategy of       a) To assess and determine the
          PREAMBLE                             the country            types and extent of employees’
  The imposition and collection                                       apprentices’ and trainees’ training
      of a human resources                                            and retraining in keeping with the
    development levy for the                                          human       resources  needs      of
    purpose of promoting the                                          industries;
  training and development of                                         b) To promote and         stimulate
  employees, apprentices and                                          manpower training; and
trainees, the establishment and                                       c) To determine the terms and
 the administration of the Fund.                                      conditions    under    which any
                                                                      financial   assistance   or other
                                                                      benefits are to be given

                                        PSMB
                                       Act 2001

                                                                                        www.hrdf.com.my
Human Resources Development Fund Malaysia - Ministry of Human Resources, Malaysia MOVING FORWARD - HRDF
HRDF COVERAGE
  EFFECTIVE 1ST
   APRIL 2017

                  www.hrdf.com.my
Human Resources Development Fund Malaysia - Ministry of Human Resources, Malaysia MOVING FORWARD - HRDF
HRDF : Industry Sectors Coverage Under The PSMB
                                                 Act 2001
                                                                                   Service Sector
            Manufacturing Sector

                                                       Energy
                                                       Hypermarket/Supermarket/Departmental Store
                                                       Direct Selling
                             Rubber Product            Commercial Land Transport and Railway Transport Services
Electrical and
                             Furniture and Fixtures    Warehousing Services
Electronic
                             Printing and Publishing   Port Services
Metal Product                                          Hotel Industry
                             Textile and Apparel
Mineral Product                                        Freight Forwarding
                             Petroleum and Coal
Food and Beverages                                     Shipping
                             Optical and
Transport Equipment                                    Air Transport
                             Photography
Plastic                                                Tour Operating Business (In-bound only)
                             Glass and Glass           Postal or Courier
Wood & Wood based
                             Product                   Telecommunication
and Cork
                             Petroleum Refinery        Research & Development
Machinery
                             Footwear                  Engineering Support & Maintenance Services
Industrial Chemicals                                   Security Services
                             Ceramic
Paper and Pulp                                         Computer Services
                             Tobacco
Iron and Steel                                         Advertising
                             Leather
                                                       Private Hospital Services
                                                       Higher Education
                                                       Training
                                                       Gas, steam and air-conditioning supply
                                                       Water treatment and supply
                                                       Sewerage
                Mining & Quarrying                     Waste management and material recovery services
                                                       Food and beverage services
                      Sector                           Production of motion picture, video and television programme, sound recording and
                                                       music publishing
                                                       Information service
                                                       Tourism enterprise
                                                       Building and landscape services
                                                       Event management services
                                                       Early childhood education
            Petroleum and gas extraction               Health support services
             Mineral and stone quarrying               Franchise
                                                       Sale and repair of motor vehicles
                                                       Private broadcasting services
                                                       Driving school
                                                       Veterinary services
Human Resources Development Fund Malaysia - Ministry of Human Resources, Malaysia MOVING FORWARD - HRDF
HRDF : Coverage Under The PSMB Act 2001
                              Effective 1st April 2017

                   To allow for
                    voluntary                                   By virtue of Section 49
                registration to all                   SOURCE   of the PSMB Act 2001 –
                  63 sub-sectors                        OF     Power of the Minister to
                 that employ5-9                       POWER
                local employees.
                                                               amend the First Schedule
                                                                       of the Act.

To delete the
 requirement
 for paid up
   capital.
                           Employers with 10 and
                           more local employees
                           across all sectors under
                            the PSMB Act 2001
                              must register with
                                    PSMB.
Human Resources Development Fund Malaysia - Ministry of Human Resources, Malaysia MOVING FORWARD - HRDF
HRDF: Mechanics of the expansion of the PSMB Act 2001

                 CURRENT CLASS OF          CURRENT       CLASS OF EMPLOYERS          IMPOSITION OF
                EMPLOYERS COVERED         IMPOSITION      COVERED AFTER THE          LEVY AFTER THE
   SECTOR       UNDER PSMB ACT 2001         OF LEVY      AMENDMENT OF PSMB           AMENDMENT OF
                                                              ACT 2001               PSMB ACT 2001

                                                       ≥10 Malaysian
                ≥ 50 Malaysian                         employees.
                empoyees.
                                                        ≥10 Malaysian
                10-49 Malaysian              1%        employees.
                employees & paid-up
Manufacturing   capital ≥RM 2.5 million                The requirement for paid-
      &                                                up capital is deleted.             1%
 Mining and
 Quarrying                                             ≥10 Malaysian
                10-49 Malaysian                        employees.
                employees & paid-up          0.5%
                capital
Human Resources Development Fund Malaysia - Ministry of Human Resources, Malaysia MOVING FORWARD - HRDF
HRDF: Mechanics of the expansion of the PSMB Act 2001

           CURRENT CLASS OF        CURRENT      CLASS OF EMPLOYERS           IMPOSITION OF
          EMPLOYERS COVERED       IMPOSITION     COVERED AFTER THE           LEVY AFTER THE
SECTOR      UNDER PSMB ACT          OF LEVY     AMENDMENT OF PSMB            AMENDMENT OF
                 2001                                ACT 2001                PSMB ACT 2001

          ≥10 Malaysian
          employees except :-
          i. Hypermarket
              ,supermarket    &      1%        ≥10 Malaysian                      1%
Service       departmental                     employees.
              store services -
              ≥50    Malaysian
              employees
          ii. Food Beverage -
              ≥30    Malaysian
              employees

                   __                 __       5-9 Malaysian employees
                                               (given option to register).        0.5%
HRDF : Coverage Under The PSMB Act 2001
                               Effective 1st April 2017

                                            EMPLOYERS COVERED
                 SECTOR                     UNDER THE PSMB ACT                   RATE OF LEVY
                                                   2001
MANUFACTURING
                                            10 ≥ Malaysian employees                      1%
MINING & QUARRYING

                                             5 - 9 Malaysian employees
SERVICE                                       (given option to register)              0.5 %

                                    REGISTERED EMPLOYERS (as at 28
                                            February 2017)

                               Manufacturing       Mining &
                                                                   Service
                                  Sector           Quarrying
                                                                    Sector
                                                    Sector

                                    7,209      +     67        +   10,382    =   17,658
HRDF: Definition of Employees &
                            Wages

       EMPLOYEE                              WAGES

 Any citizen of Malaysia who is   Basic salary and fixed allowances
 employed for wages under a         or other emoluments of a like
  contract of service with an       nature paid in cash by or on
employer, but does not include      behalf of an employer to an
    any domestic servant                      employee

                                       1% FROM THE TOTAL WAGES
          Temporary
                                        (for mandatory category)

           Contract
                                       0.5% FROM THE TOTAL WAGES
                                          (for optional category )
          Permanent
REGISTRATION
BENEFITS

               www.hrdf.com.my
PERCENTAGE OF SKILLED WORKFORCE FOR
                                 HRDF REGISTERED EMPLOYERS

                                       SKILLED
           28%                       WORKFORCE                                                      38%
          Nation                                                                                    HRDF
                                 Percentage of skilled workforce
                                 under HRDF coverage are 38%
                                 Note:
                                 Definition of Skilled Workers was based on the Department of
                                 Statistics (DOS) job positions category: Managers, Professionals
                                 and Technician and Associate Professionals

Source: Study on the HRDF Registered Employers’ Employees’ Skilled Bracket 2014
Note: Data were based on NER 2011 by ILMIA, Ministry of Human Resources                              www.hrdf.com.my
THE NET IMPACT OF 1% LEVY CONTRIBUTION FOR
                                                        SMEs

   NET IMPACT OF                                                                                     It was found that training
                                                                                                     programmes by HRDF indicated a
        HRDF
                                                                                                     strong positive impact including
                                                                                                     effects on productivity (Total
                                                                                                     Factor Productivity [TFP] and
                                                                                                     Labor Productivity).

                                                                                                     The highest impact was on
                                                                                                     investment in machinery and
                                                                                                     equipment and capital intensity
                                                                                                     followed by increase in value
                                                                                                     added and TFP.

                                                                                                     This programme also showed
                                                                                                     increase in labor productivity and
                                                                                                     wages.

Source: World Bank based on census and survey from Department of Statistics, Malaysia – SME Master plan 2012-2020

                                                                                                                       www.hrdf.com.my
EFFECTIVENESS STUDY OF THE HUMAN RESOURCES
                                           DEVELOPMENT FUND (HRDF)

The study found that HRDF
training schemes were effective                                                     • Increasing the
in terms of…                                                                          employees’ knowledge
                                                                                      and skills
                                                                                     • Increasing companies’
                                                                                       performance
                                                             • Improving companies’
                                                               productivity level

Further findings have shown that training were able to effectively give impacts
                   to the actual business results in terms of …

                                                                                                          www.hrdf.com.my
Source: Study on the Effectiveness of Human Resources Development Fund (HRDF) by Saujana Edu Urus Sdn. Bhd.
EFFECTIVENESS STUDY OF APPRENTICESHIP SCHEME

                       APPRENTICE                                          EMPLOYERS

           80%       APPRENTICE BEING EMPLOYED WITHIN 6
                     MONTHS AFTER COMPLETION OF            95% SAID THAT SALARY OFFERED BY
                                                               THEM WERE ALIGNED WITH
                     TRAINING
                                                                    APPRENTICES’ SKILLS AND
                                                                    EXPERIENCE GAINED DURING
                                                                    TRAINING

           RM1,202                                                  EMPLOYERS WERE SATISFIED
           AVERAGE STARTING MONTHLY            PAYMENT              WITH APPRENTICES’ SKILLS AND
           RECEIVED BY APPRENTICES                                  KNOWLEDGE THAT ARE IN-LINE
                                                                    WITH         ORGANISATION’S
           1.0% - 44.3%                                             WORKING ENVIRONMENT. THEY
           AVERAGE SALARY INCREMENT RECEIVED BY                     ALSO PROVIDE OPPORTUNITY
           APPRENTICES (comparison between entry level              FOR APPRENTICES TO APPLLY
           salary and salary received during study being            THEIR    SKILLS    IN     THE
           conducted)                                               ORGANSATIONS

           82%       APPRENTICES SATISFIED WITH THE
                     QUALITY OF TRAINING DELIVERY DONE     71% SATISFIED WITH PERFORMANCE
                                                               SHOWED BY APPRENTICES AT
                     BY   TRAINING    PROVIDERS    AND
                     SPONSORING EMPLOYERS                           WORKPLACE

Source: The Effectiveness Study of Apprenticeship Scheme under RMK-9 by IRSHAD Consulting Sdn. www.hrdf.com.my
                                                                                               Bhd.
EFFECTIVENESS STUDY OF
                                   THE TRAINING INCENTIVE SCHEME

 Majority of respondents cited that the scheme has positive impacts on employees in
 the areas of:

Enhanced Job-Relevant             Improved          Increased Job Motivation of       Reduced Levels of Absenteeism
 Knowledge and Skills            productivity            Trained Employees              (Sick Leaves and No-Shows)

                                                                      • More motivated than non-
 They also have seen the                                                trained employees
 difference between trained
                                                                              • More productive than non-
 employees and non-trained                                                      trained employees
 employees       under   this
 programme in terms of:                                                           • More likely to be promoted
                                                                                    than non-trained employees

                                                                             • More likely to receive a salary
                                                                               increment than non-trained
                                                                               employees

Source: Study on the Effectiveness of Training Incentive Scheme (2011/2012 Allocation) by Frost & Sullivan
HRDF: Registration Benefits

HRD LEVY IS ALLOWABLE
EXPENSE UNDER INCOME
TAX ACT 1967

                                         www.hrdf.com.my
HRDF: Registration Benefits

One-off training grant of RM5000
to employers registered through the
associations (limited to the first 400
employers).

    Help and ground support through
    nationwide briefings to members of
    associations by HRDF.
HRDF: Registration Benefits

                                                                                    Human
                                       Free                                        resource
  Free HRDF                       consultation                                  management
                Free trainings                       Online
workshop slot                        fees on                     Claimable on    consultative
                   for SMEs                        training to
for each and                       conducting                       the job     services under
                  under SME                       cater SMEs
    every                         organisation                      training       National
                development                       employees’
employer that                    training needs                  programmes.        Human
                programmes.                          needs.
 registered.                       analysis for                                   Resource
                                      SMEs.                                          Centre
                                                                                    (NHRC).
BENEFITS TO SME
                     OBJECTIVE OF SME CAPABILITY PROGRAMME

To develop and enhance the capabilities of the Small Medium Enterprises (SME) through a structured
training and skill development programme whose outcome are measurable. This will be an
advantage for potential registered PSMB employers.
                                                                            1. To support the
                                                                            mandate under
                                                                            NSDC and
                                                      • Productivity        SME Master
                                                        and Efficiency      Plan (2011-2020)
      Innovation                                      • Increase in
                    Productivity
                                                        Profitability
                                        Outcome       • New
                                                        employment
              HRM                                       creation            2. To strengthen
                                                      • Business            Strategic Human
                                                        Sustainability      Resource Management
                                                                            of SMEs (SRI- Human
                                                                            Capital Development)
          SME CAPABILITY
           PROGRAMME

                                                                                                 Page
                                                                                                   22
PROGRAMME IMPLEMENTATION
               UNDER SME CAPABILITY PROGRAMME

                                            Business Management,
                                            Business Strategies,
Focus on building the                       Finance, Innovations,
capability and leadership of   Strategic    Business sustainability
the entrepreneur.              Level        and Strategic Human
                                            Resources
                                            Management.

Focus on skill upgrading                    Soft skills and
and development of the         Functional   technical skills.
Employee.                      Level        (Accounting / Finance
                                            / Marketing / Quality)
ADOPTION OF DIAGNOSTIC TOOL FOR SME
                               EMPLOYERS
 MyFuture is a SME Competency Profiling Tool that was developed by Human Resources
 Development Fund to address the growing concerns on the effectiveness, timeliness
 and impact of SME training and development programmes. It is a diagnostic tool use to
 rate and enhance competitiveness of SMEs based on their performance and
 capabilities.

                                    Recruitment

Structured training intervention                               Measurable outcome
                                    Performance
HOW THE DIAGNOSTIC TOOL FOR SME
                                  EMPLOYERS WORKS?

                                                                                 • Detailed
                                                                                   capability
 Diagnostic Tool                Training                  Outcome
                                                                                   inventory
                                                                                 • Roll out
                             Intervention                                          customised HR
                                                                                   training and other
                                                                                   interventions for
                                                                                   SMEs
                                                                                 • Enabler for SME
HR Maturity                                                                        Champions!
                            Findings                   Results
• Recruitment               • Map findings to          • Business Productivity
• HR Management               training programme       • Business Efficiency
• Manpower Planning           (technical/soft skill/
                              certification and        • Increased
• Training & Development      leadership)                Profitability
• Performance               • Use NHRC services to     • Staff turn-over
  Management                  resolve issue on         • Sales turn-over
• Compensation & Benefits     Human Resource           • Increase in export
                              Management.
• Talent Management &
  Succession Planning
www.hrdf.com.my
“PEOPLE, PROWESS, PROGRESS”

 THANK YOU
www.hrdf.com.my
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