The Human Resource Development Corporation (HRD Corp), formerly known as PSMB (Pembangunan Sumber Manusia Berhad), operates under the Human Resources Ministry of Malaysia and administers the Human Resources Development Fund (HRDF). It plays a pivotal role in workforce upskilling and talent development in Malaysia.
Primary Roles and Functions:
- Encouraging Workforce Development:
- HRD Corp ensures that Malaysian employees remain competitive in an evolving global market by encouraging employers to invest in upskilling and reskilling their workforce.
- Training Grants:
- Employers registered under HRD Corp can claim financial assistance to cover training costs for employee development programs.
- Certifications and Skills Upgrades:
- It offers industry-relevant certifications, upskilling courses, and initiatives aligned with Malaysia’s national development goals, including IR 4.0, digital transformation, and green economy skills.
- Industry-Specific Support:
- HRD Corp provides customized training programs and funds tailored to meet the needs of specific industries.
- Digital and E-Learning Platforms:
- It has introduced online learning portals such as e-LATiH to encourage continuous learning in a flexible and cost-effective manner.
- Supporting National Economic Goals:
- HRD Corp initiatives align with Malaysia’s Vision 2030 and economic goals, particularly in improving productivity and reducing skill gaps.
Employer Obligations under HRD Corp
1. Employer Registration
Employers operating in sectors covered under the Human Resources Development Act 2001 are required to register with HRD Corp if they meet the following criteria:
- They have 10 or more Malaysian employees in the applicable sectors.
- Employers in specific industries such as manufacturing, services, and mining and quarrying are automatically included.
Employers with 5 to 9 Malaysian employees may register voluntarily.
2. Monthly Levy Contribution
Once registered, employers are obligated to contribute a levy to the Human Resources Development Fund. The levy rates are as follows:
- 1% of the monthly wages of Malaysian employees for employers with 10 or more employees.
- 0.5% of the monthly wages for employers with 5 to 9 employees (voluntary registration).
Note: The levy is based solely on the wages of Malaysian employees; contributions are not required for foreign employees.
3. Utilization of the Fund
Employers can utilize the levy contributions for:
- Approved training programs.
- Skills development initiatives for their employees.
- e-Learning courses provided under HRD Corp.
Unused levy contributions may expire if not utilized within the stipulated period.
4. Record-Keeping
Employers must maintain accurate payroll and employee training records to ensure compliance during audits by HRD Corp.
5. Penalties for Non-Compliance
Employers who fail to comply with the following may face penalties:
- Failure to register: Employers eligible for registration but fail to do so may be fined up to RM10,000 or face imprisonment of up to 1 year, or both.
- Failure to contribute: Non-payment of levy contributions can result in fines and back payments with penalties.
How Employers Can Benefit from HRD Corp
By complying with HRD Corp’s requirements, employers can: