Construction firms seek one-year grace period for staff accommodation standards compliance

PETALING JAYA: The construction industry is appealing to the government for a one-year grace period to comply with the latest amendment to Act 446 which is the Employees’ Minimum Standards of Housing, Accommodations and Amenities Act 1990 via a joint statement by six construction associations.

The associations consisting of Master Builders Association Malaysia, Persatuan Kontraktor Melayu Malaysia, Persatuan Kontraktor Bumiputra Malaysia, Persatuan Kontraktor India Malaysia, Guild of Bumiputra Contractors Wibawa and United Malaysia Contractors Association said the grace period can also be used to further educate the industry on the need to adhere to such compliance in accordance with the provisions of the law.

The associations lauded the initiative to provide conducive living space for workers outlined in the amendment which was gazetted on Feb 17, 2021 but voiced that it is ill-timed given the emergency ordinance and the unfavourable economic climate.

It related that the rising construction cost and standard operating procedures (SOP) compliance cost has resulted in cash flow problems and financial constraint for contractors.

“There is a need for sufficient time for the industry to recover. Under the new law, if employers are unable to provide proper housing facilities for workers in accordance with Act 446, employers are required to provide temporary accommodation which would cost RM270 per worker.” said the joint statement.

It pointed out that the total sum for a construction to be borne by employers will be quite hefty.

Under the amendment, failure to comply would result in a RM200,000 fine, a jail term of up to three years or both.

The associations argued that the amended fine in such a weak economic climate is too drastic and will hamper the recovery of the industry as it is struggling to maintain operations after being severely affected by the Covid-19 pandemic.

It also expressed concerns over the enforcement of the act due to the possible misinterpretation by the different authorities given the delegation of enforcement powers under the emergency ordinance.

Source: The Sun Daily