The Prime Minister, Datuk Seri Dr. Mahathir Mohamad had announced a two per cent reduction in employees’ contribution for a year with effect from April 1 as part of the government’s economic stimulus package to counter the US economic slowdown.
As under the EPF Act 1991, such a two per cent cut can only be optional and cannot be made compulsory, the EPF is duty-bound to ensure that the 9.7 million EPF contributors are not put to any inconvenience, unnecessary hassle or red tape should they want to continue to make 11% contribution to the EPF.
Under Section 43 of the EPF Act 1991, which stipulates that every employer and employee is entitled to pay monthly contributions exceeding the statutory minimum rate, EPF contributors must give notice to the Board if they want to elect to pay more than the statutory rate.
The most convenient and hassle-free method for the 9.7 million EPF contributors who want to continue to pay 11% rate of contribution instead of the new nine per cent minimum rate announced in the economic stimulus package is for the EPF to recognise any continuation of the previous EPF contributions without the two per cent reduction as adequate notice of such intention.
This would mean that there would be no need for any EPF contributor to go through the hassle and red tape of having to send a separate notification to the EPF to forgo the two per cent cut and to keep to the 11% contribution rate - which could run into millions of notices inundating the EPF with a time-span of a few days.
As the duties of the workers’ representatives on the EPF Board are to protect and represent the rights and interests of the workers, they should requisition an emergency EPF Board meeting to ensure a completely hassle-free process for EPF contributors who want to continue to pay the 11% contribution rate or the six workers’ representatives would be failing in their duties to the workers as EPF Board members.