Thread: Malaysia’s bid to revamp hiring of foreign workers faces pushback

KUALA LUMPUR: An ambitious plan by the Anwar Ibrahim government to overhaul the country’s migrant worker recruitment policies, particularly the problem-ridden employment of Bangladesh nationals, is coming under stiff resistance from industry players and segments of civil servants determined to maintain the status quo.


Pushback against the government’s migrant labour reform is coming from privately controlled Bestinet Sdn Bhd, a firm which has strong links to Malaysia’s top politicians and has long been a magnet for controversy, government sources told CNA.

The contention is over plans by the Home Ministry to replace Bestinet’s proprietary IT system that currently manages the movement of foreign labour into Malaysia, which a previous government review had concluded as riddled with abuse and mismanagement.


Bestinet’s contract with the government to operate its so-called Foreign Workers Centralised Management System (FWCMS), which is the sole platform used by the country’s Immigration Department for visa applications from 15 different countries exporting labour to Malaysia, is set to expire at the end of this month, according to government sources and documents reviewed by CNA.


The company’s top management, including founder Mohamed Amin Abdul Nor, and labour agents aligned with Bestinet have been actively lobbying the Anwar government, say sources. This includes tapping their connections with Malaysia’s political elite to secure a fresh multi-year extension for the FWCMS concession.


Bestinet is determined to head off a government plan to introduce a new mechanism, administration officials and labour activists close to the situation say.


The new system features an IT portal that has been under development for the past year and seeks to make the process of foreign labour recruitment cheaper, more transparent and minimise third-party involvement.

Home Minister Saifuddin Nasution Ismail did not respond to requests for comment, but a senior advisor to his ministry said the matter will be discussed at the weekly Cabinet meeting before Prime Minister Anwar makes a final decision.


Bestinet executives declined comment for this article.


HIGH STAKES FOR BESTINET AND ANWAR


Securing an extension to its FWCMS platform is critical to Bestinet, which is a pivotal player in the multi-billion-ringgit foreign labour recruitment sector.


The company declared a net profit of RM85.04 million (US$18 million) in end-2022, a whopping jump from a paltry RM704,432 the year earlier, according to financial information lodged at the Companies Commission of Malaysia.


The stakes are equally high for the Anwar administration.

Malaysia, an export-dependent economy and one of the world’s top 30 trading nations, has been recruiting workers since the early 1990s and migrant labour makes up about 30 per cent of Malaysia’s workforce that is estimated at 14.5 million employees.


But combined with the number of undocumented workers, their numbers could be as high as 38 per cent, or around 5.5 million based on unofficial estimates.

The migrant labour recruitment industry has long attracted domestic and international opprobrium due to collusion among politicians, enforcement agencies, recruitment companies, labour brokers and exploitative employers.


This has resulted in Malaysia being listed with the likes of China and North Korea for its poor progress in eliminating human trafficking by the United States State Department.


Since December last year, Malaysia also has seen a wave of Bangladeshi workers being lured over by fake job opportunities. Rights groups estimate their numbers could be in the tens of thousands.

Last month, a group of experts from the United Nations chastised the Malaysian government over the plight of the Bangladeshi workers.


The experts expressed concern that large sums of money were being generated through the fraudulent recruitment of migrant workers by criminal networks operating between Malaysia and Bangladesh.


Migrants were being deceived, recruited by companies that are frequently fake, and obliged to pay exorbitant recruitment fees which pushes them into debt bondage, the experts said.


“The situation of Bangladeshi migrants who have lived in Malaysia for several months or longer is unsustainable and undignified,” the experts said. “Malaysia needs to take urgent measures to address the dire humanitarian situation of migrants and protect them from exploitation, criminalisation and other human rights abuses.”


Responding days later, Bestinet defended its FWCMS system. Such cases involving Bangladeshi workers “could be avoided with proper due diligence through the FWCMS system”, chief executive officer Ismail Mohd Noor told the New Straits Times.


By digitising and centralising steps in the hiring and management of migrant workers, the system provides visibility and traceability, mitigating the risk of exploitation and abuse, he claimed.

RAIDED IN 2023


Bestinet is no stranger to controversy.


In 2018, it was embroiled in allegations its affiliates had benefited to a tune of RM185 million between 2013 and 2018 from Nepali workers seeking to work in Malaysia. The Malaysian government suspended Bestinet’s operations, but cleared it of wrongdoing the following year.


In May 2023, the Malaysian Anti-Corruption Commission (MACC) arrested several government officials at the Human Resource Ministry in connection with a corruption investigation involving the recruitment of migrant workers from Bangladesh. Weeks later, it raided Bestinet and questioned a number of its executives, including its controlling shareholder Mr Mohamed Amin.


So far, nothing has emerged from the MACC probe, but the Anwar administration has transferred the governance of the migrant worker procurement ecosystem from the Human Resource Ministry to the direct purview of the powerful Home Affairs Minister Saifuddin.


Mr Mohamed Amin, a former Bangladesh national who has taken up Malaysian citizenship, is said to enjoy close ties with top civil servants and politicians including Deputy Prime Minister Ahmad Zahid Hamidi. It was during Mr Ahmad Zahid’s tenure as Home Minister under the previous Najib administration that Bestinet secured the concession to operate its FWCMS platform.


But the company’s relations with the Home Ministry under Mr Saifuddin has been less-than-cosy.


Mr Saifuddin has made no secret of his displeasure with the current migrant labour recruitment system. During an official visit to Bangladesh in February last year, Mr Saifuddin met with members of the Bangladeshi Association of International Recruiting Agencies (BAIRA) in Dhaka. He acknowledged he was unhappy with the recruitment systems in place and that elements of graft needed to be wiped out.


BAIRA has more than 1,500 members operating in the country but only 100 agencies with close ties to Bestinet and accredited by the Malaysian government have a stranglehold on the recruitment of workers to Malaysia.


BAIRA’s chairman Mohammed Abul Basher told CNA that the government is handling negotiations with Malaysia directly over the plan to revamp the current recruitment process. He declined to elaborate.


UNSCRUPULOUS AGENTS, BROKERS


Malaysia’s foreign labour recruitment system had long been a hotbed of unscrupulous agents and labour brokers working with counterparts in countries providing the manpower.


In a bid to bring more order to the labour recruitment sector, the government of now-jailed former premier Najib Razak awarded Bestinet a contract in 2013 to assist the Home Affairs and Human Resource ministries in the recruitment of foreign labour for Malaysian companies.


Under the so-called FWCMS, companies in various sectors of the economy would submit applications on their labour needs and Bestinet would help in the sourcing from 15 countries such as Indonesia, Bangladesh, Nepal, the Philippines, Myanmar, India and Vietnam.


But the FWCMS platform did not stem mismanagement, resulting in foreign labour applicants being exploited by a convoluted set of players in both the host and exporting countries.


Malaysia’s bid to revamp hiring of foreign workers faces pushback; activists say country’s reputation at stake - CNA

Of course they want that gravy train to continue. Does the government have the balls to change it?