KUALA LUMPUR: Employers have expressed concerns that the tenfold increase in the maximum penalty for violations under the Occupational Safety and Health (Amendment) 2022 (OSHA) and the Factories and Machinery Act (Repeal 1967) may be excessively burdensome for small businesses.
They call for a more balanced approach to ensure a safe work environment for employers.
Malaysian Employers Federation (MEF) president Datuk Dr Syed Hussain Syed Husman said while the amendment of OSHA is timely, the maximum penalty of RM500,000 is excessively high and should be reconsidered.
He said that micro, small and medium enterprises (MSMEs), as well as self-employed individuals, would struggle to afford such penalties.
"There are more than 90 per cent MSMEs in the country, which may not have the financial resources to have a comprehensive OSH programme at the workplace.
"Raising the penalty to RM500,000 for all does not make sense. A tiered penalty system based on the size and operations of the business could be a more viable option," he told the New Straits Times.
Syed Hussain said imposing harsh penalties is not the best approach. Instead, the government should consider other mechanisms to help industries meet safety and health standards.
MEF believes that the maximum penalty should only be used as a last resort against uncooperative employers that fail to implement proper OSH procedures and safeguards, leading to fatal workplace accidents.
The Federation of Malaysian Manufacturers president Tan Sri Soh Thian Lai said while higher penalties could serve as a strong deterrent, the substantial increase is particularly challenging for SMEs already struggling with compliance costs.
Soh suggested a phased implementation or support programmes to help businesses upgrade their safety measures without facing severe financial repercussions, especially SMEs.
"Increasing the penalty tenfold could potentially ensure a safer working environment and better attention to workers' welfare, but its effectiveness will also depend on the enforcement of the act and its regulations.
"Regular inspections, prompt action against violations and a transparent reporting system are essential to ensure that the threat of high penalties translates into real improvements in workplace safety.
"Employers and employees alike must be aware of the new regulations and understand their responsibilities," he said.
Soh said educational campaigns and training sessions can help inculcate a culture of safety within organisations, making the increased penalties more effective.
He added that providing support to SMEs to help them comply with safety regulations can enhance the overall effectiveness of the new penalties.
He said this support includes financial assistance, access to safety training and resources for upgrading equipment and facilities as well as having clear and fair guidelines.