MPOA Sarawak calls for immediate review of Foreign Worker Transformation Approach, online labour system

KUCHING (May 21): The Malaysian Palm Oil Association (MPOA) Sarawak Branch has called for an immediate review of the implementation of the Foreign Worker Transformation Approach (FWTA).

It also called for a review of the framework and operational enhancements to the Sarawakian and Non-Sarawakian Online Labour System (Sansols) system to ensure practical, efficient, and sustainable implementation for Sarawak’s plantation sector.

“We acknowledge and support the Sarawak government’s efforts to strengthen governance, transparency and digitalisation in foreign worker management through the FWTA and Sansols platform.

“These objectives are progressive and aligned with the industry’s commitment towards responsible labour governance and regulatory compliance.

“However, the current implementation has introduced significant operational challenges and substantial additional costs to be incurred by employers, particularly within Sarawak’s labour-intensive plantation sector,” MPOA Sarawak Branch said in a statement.

The statement comes in support of concerns raised by the Sarawak Oil Palm Plantation Owners Association (Soppoa) regarding the implementation of the FWTA.

According to the branch, the administrative fee of RM1,854 per worker (excluding Sales and Service Tax) imposed under FWTA represents a substantial additional cost to be incurred by employers for every foreign worker recruited under the system.

“This cost is significantly higher compared to recruitment frameworks in Peninsular Malaysia and Sabah, where equivalent charges are not imposed, placing Sarawak-based employers at a distinct competitive disadvantage,” it said.

For plantation operators managing large-scale foreign worker recruitment, the cumulative cost to be incurred is considerable and further compounds existing financial pressures arising from the implementation of the RM1,700 minimum wage, the mandatory Employees’ Provident Fund (EPF) contributions for foreign workers, increasing compliance obligations and broader rising operational costs across the sector, it pointed out.

The branch is also concerned that operational inefficiencies within the Sansols system were resulting in additional indirect costs to be incurred by employers through delayed worker mobilisation, prolonged vacancies, productivity disruptions, and workforce planning uncertainties.

Under the Sansols system, it said employers are required to make full payment at the initial application stage, with no refund mechanism where applications are rejected by the Immigration Department or where Indonesian workers (PMI) are denied entry at the border.

As such, it recommended the introduction of a structured refund or partial refund mechanism to mitigate financial losses beyond employers’ control.

The branch said additional charges were imposed where employers opted to utilise their own registered panel clinics for worker medical examinations.

It said this creates unnecessary duplicated costs and contributes to delays caused by concentration of applicants at limited approved clinics.

Given this, it suggested expanding the pool of accredited clinics and allowing employers flexibility to select their preferred registered panel clinic.

“Approval timelines remain prolonged and comparable to the previous manual system, undermining the objective of digitisation and efficiency enhancement.

“Sansols currently serves primarily as a reporting platform without effectively resolving technical or procedural issues involving multiple agencies. A centralised coordination and issue-resolution mechanism should be established within the system,” said the branch.

It went on to say that the absence of a pre-screening module results in avoidable recruitment costs where candidates are later rejected due to blacklist or ‘senarai syak’ (suspected list) issues.

The branch believed that a centralised eligibility verification mechanism should be implemented before payment submission.

“The platform does not allow employers to provide remarks or flag urgent cases for officer review. We recommend introducing a remarks and escalation function within the system.

“The eVDR validity period currently commences from the date of application rather than issuance, significantly shortening effective utilisation periods where delays occur. Validity should instead commence from the issuance date,” it said.

The branch called on the Sarawak government and all relevant implementing agencies to engage closely with industry stakeholders to review the FWTA framework and enhance the operational effectiveness of the Sansols system.

“MPOA remains committed to constructive collaboration with the Sarawak government and all relevant authorities to ensure labour policies are implemented in a practical, transparent and sustainable manner that supports both regulatory objectives and the continued growth of Sarawak’s palm oil industry,” it added.