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Elaine Sim

An agency perspective: On ethical recruitment in ASEAN 2024

Updated: Dec 18

Migratesafe is a full service employment agency dedicated to the safe migration of migrant workers from the Indonesian and Filipino corridor to Sarawak, Malaysia. For the past 2 years, we have been rolling out ethical recruitment solutions in the domestic worker market, explored conversations with manufacturers for ethical recruitment and assisted companies with work permit compliance. 

What are some of the challenges for ethical recruitment in Sarawak and Malaysia? 


Sarawak’s geographical challenges and regulatory gaps pose challenges for ethical recruitment. Beyond this, Malaysia as a whole is caught in a double whammy when it comes to the recruitment of foreign labour. Malaysian companies generally pay more than Singaporean companies to hire foreign workers, because Malaysia is not as desirable for APAC migrants. Secondly, despite the higher recruitment costs, the skills of migrants are not directly proportionate to the higher investment. Inversely, first timers and inexperienced migrants are applying to Malaysia as a first contract market.  


The employer pays principle 


There are challenges to the adoption of the employer's pay model in Malaysia. While we already see certain industries like semiconductor, oil palm plantations and rubber glove manufacturers taking the lead in implementing the employer pays model, other industries lag behind. Coincidentally, the industries that lead in fair and ethical recruitment compliance, are also industries that rely heavily on exports. And also where international trade rules or trading countries have imposed conditions of fair trade or responsible recruitment in supply chains. 


Debt bondage or illegal recruitment fees 


Migrant workers are typically cash flow poor at the job seeking stage. Therefore, recruitment fees are commonly structured as debt via future salary deductions. In some source countries such as the Philippines, employment contracts can be used as collateral for a loan. It is also very common for migrant workers to rely on agencies for loans or “processing allowances”. For the Malaysia market, the longer processing duration of 3 - 5 months can also lead to worker financial issues. Many workers do not plan ahead to work abroad, and therefore will engage an agency to find them work abroad when they are already in debt or close to debt. 


No doubt, there is exploitation in the recruitment market. Migrant workers rely heavily on agents or agencies to find them work abroad, comply with medical requirements, obtain a visa and travel to the destination country. This reliance can sometimes create the wrong incentives for agencies who use worker salaries to excessively charge high recruitment costs. However, a lot of these practices are scaling back with the requirement of employers to open bank accounts for workers or provide remittance slips for salary payments. Increasing implementation of freedom of movement principles are also reducing the instances of debt bondage. 


More regulation or business solutions? 

In the recruitment industry, more regulation typically leads to increased costs, which ultimately hurts the consumer or hiring company and migrant workers. With that said, regulations are definitely necessary to protect the interest of the destination country to achieve controlled labour migration, and for source countries to safeguard worker welfare. For example, licensed agencies who are given exclusive rights to bring migrant workers through specific corridors are also responsible for the insurance, travel, medical, contract enforcement and safe repatriation of migrant workers. 


More business solutions are needed in the migrant worker industry to resolve some pre-existing challenges. For example, for workers to have more autonomy over salaries and fair compensation, financial tools need to exist for ease of salary payment by employers to workers. Remittance companies have also created a lot of products lately to lower the cost of remittance and democratise access to fast, cheap and frequent remittances. 


Case studies and testimonials 


Since Migratesafe’s entry to the Sarawak market, we have led the industry on recruitment and immigration compliance. For example, in early 2023, we were the first agency to register with the Indonesian Consulate in Sarawak, and the 2nd agency accredited by the Philippines Migrant Worker Office, for the full regulatory compliance of migrant domestic workers in Sarawak. We’ve also implemented a strict zero-cost recruitment for workers and adherence to the employer pays model for migrant domestic workers in Sarawak - setting a new standard in our niche market. 


Other notable changes include compliance to the new minimum wage for Indonesian workers, proper entry via calling visas rather than illegal entry via tourist visas, rest day and overtime implementation and advocating for handphone usage, which both contribute to respect for freedom of movement and communication. 100% of Migratesafe workers are in Sarawak and Malaysia with legal permits. 


Partnerships and collaborations 


For the past 2 years, we’ve prioritised building strong partnerships with ethical players within the ASEAN region. This includes building relationships with training centres, recruiters, government agencies, and consulates. To promote transparency, we’ve made a lot of immigration information available to those who want to find out more about hiring legally in Sarawak or policy information and compliance procedures for a proper work entry. In short, we’re serious about building an ethical and compliant business! 


Our future direction


Migratesafe hopes to expand our compliant and ethical service offerings to the whole of Malaysia and beyond. We aspire to be a leading voice in the ethical recruitment space starting in the ASEAN region, addressing market challenges, identifying policy changes, and supporting our clients with a holistic suite of business centered recruitment and immigration solutions. 


Our website and its contents are provided for general information purposes only and nothing on this website or in its contents is intended to provide professional advice. Please contact us at info@migratesafe.org or +6082-295175 for more information. 


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