HUMAN RESOURCES DEVELOPMENT ACT 1992

(Act 491)

ARRANGEMENT OF SECTIONS

PART I

PRELIMINARY Section

1. Short title and application. 2. Interpretation.

PART II

HUMAN RESOURCES DEVELOPMENT LEVY

3. Imposition of levy. 3A. Imposition of levy on specified employer. 3B. Interest on levy due but not paid in time. 4. Duty of employer to register with Council. 5. Exemption from levy.

PART III

ELIGIBILITY FOR FINANCIAL ASSISTANCE

6. Qualifying conditions. 7. Penalty for obtaining money or benefit by false or misleading statement or document. 8. Repayment.

PART IV

HUMAN RESOURCES DEVELOPMENT FUND

9. Establishment of Fund. 10. Recovery of levy and loan. 11. Investment Panel. 12. Power to invest.

PART V

HUMAN RESOURCES DEVELOPMENT COUNCIL

Section

13. Establishment of Council. 14. Council to be Trustee of Fund. 15. Members of the Council. 16. Alternate members.

17. Temporary exercise of functions of Chairman. 18. Functions of the Council. 19. Powers of the Council. 20. Appointment of officers and servants of the Council. 21. Members, officers and servants deemed to be public servants. 22. Committees.

PART VI

EXECUTING AGENTS

23. Appointment of agent. 24. Duty of agent to maintain proper records.

PART VII

ACCOUNTS AND AUDIT

25. Application of Statutory Bodies (Accounts and Annual Reports) Act 1980.

PART VIII

GENERAL PROVISIONS

26. Offences by body corporate. 27. Regulations. 28. Power of Minister to give directions. 29. Appeals. 30. Secrecy.

SCHEDULES.

 

HUMAN RESOURCES DEVELOPMENT ACT 1992

(Act 491) (In Force From 1-1-1995)

An Act to provide for the imposition and collection of a human resources development levy for the purpose of promoting the training of employees, the establishment of a Human Resources Development Council and Fund and for matters connected therewith

 

BE IT ENACTED by the Duli Yang Maha Mulia Sen Paduka Baginda Yang di-Pertuan Agong with the advice and consent of the Dewan Negara and Dewan Rakyat in Parliament assembled, and by the authority of the same, as follows:

PART I

PRELIMINARY

1. Short title and application.

(1) This Act may be cited as the Human Resources De- velopment Act 1992.

(2) This Act shall apply to the classes of employers in the industries specified in the First Schedule.

(3) The Minister may, from time to time, by an order published in the Gazette, add to, delete from, vary or amend the First Schedule.

2. Interpretation.

In this Act, unless the context otherwise requires—

"apprenticeship contract" means a written contract entered [Am. Act into by a person with an employer who undertakes to employ A956] the person and train or have him trained systematically for a trade for a specified period approved by the Director-General in the course of which the apprentice is bound to work in the employer's service;

"contract of service" means any agreement, whether oral or in writing and whether express or implied, whereby one person agrees to employ another as an employee and that other agrees to serve his employer as an employee and includes an apprenticeship contract;

"Council" means the Human Resources Development Council established under section 13;

"Director General" means the Director General appointed under section 20;

"domestic servant" means a person employed in connection with work of a private dwelling-house and not in connection with any trade, business or profession carried on by an employer in such dwelling-house and includes a cook, house-servant, butler, child's nurse, valet, gardener, washerman or washerwoman, watchman and driver or cleaner of any vehicle licensed for private use;

"employee" means any citizen of Malaysia who is employed for wages under a contract of service with an employer, but does not include any domestic servant;

"employer" means any person who has entered into a contract of service to employ any other person as an employee and includes the agent, manager or factor of such first-mentioned person;

"Fund" means the Human Resources Development Fund established under section 9;

"levy" means the human resources development levy im- posed under section 3 or 3A;

"wages" means the basic salary and fixed allowances or other emoluments of a like nature paid in cash by or on behalf of an employer to an employee, and includes any leave pay and arrears of wages but does not include—

(a) any contribution paid by an employer on his own account to any pension fund, provident fund, super- annuation scheme, retrenchment, termination, lay-off or retirement scheme, thrift scheme or any other fund or scheme established for the benefit or welfare of the employee;

(V) any travelling allowance or the value of any travelling concession;

(c) any sum payable to the employee to defray special expenses entailed on him by the nature of his em- ployment;

{d) any gratuity payable on discharge or retirement; or (e) any bonus or commission.

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PART II

HUMAN RESOURCES DEVELOPMENT LEVY

3. Imposition of levy.

(1) Subject to section 5, there shall be imposed on every employer a human resources development levy in respect of each of his employees at the rate of one per centum of the wages in any month of the employee.

(2) The Minister may, from time to time, by order published in the Gazette reduce or increase the rate of the levy specified in subsection (1).

(3) Where an employer fails to pay any levy due within such period as may be prescribed, the employer shall be guilty of an offence and shall, on conviction, be liable to a fine not exceeding ten thousand ringgit or to imprisonment for a term not exceeding two years or to both.

(4) Prosecution for an offence under subsection (3) shall not preclude the right of the Council to recover the amount of any levy due under this Act from the employer.

3A. Imposition of levy on specified employer.

(1) Notwithstanding subsections 1 (2) and 3( 1), an employer in the manufacturing industry with ten but not more than forty- nine employees and with a paid-up capital of less than two million and five hundred thousand ringgit, and who opts to be registered with the Council, shall be imposed a human resources development levy in respect of each of his employees at the rate of 0.5 per centum of the wages in any month of the employee.

(2) In the event of any default in the payment of any levy due under subsection (1), the provisions of subsections 3(3) and (4) shall apply.

3B. Interest on levy due but not paid in time.

An employer who fails to pay any levy due within such period as may be prescribed, shall be liable to pay interest thereon at the rate of ten per centum per annum in respect of each day of default or delay in payment:

Provided that—

(a) if the amount of interest so calculated is less than five ringgit, the interest payable shall be five ringgit in respect of each month or part of a month of the default or delay in payment; or

(b) if the amount of interest so calculated exceeds five ringgit, the interest payable shall be calculated to the next highest ringgit in respect of each month or part of a month of the default or delay in payment.

4. Duty of employer to register with Council.

(1) Every employer to whom this Act applies shall register with the Council within such time and in such manner as may be prescribed.

(2) Any employer who contravenes subsection (1) shall be guilty of an offence and shall, on conviction, be liable to a fine not exceeding five thousand ringgit or to imprisonment for a term not exceeding one year or to both.

(3) Where any person ceases to be an employer under this Act, he shall within thirty days of such cessation notify the Council in such manner as may be prescribed.

(4) Any person who contravenes subsection (3) shall be guilty of an offence and shall, on conviction, be liable to a fine not exceeding two thousand ringgit or to imprisonment for a term not exceeding six months or to both.

(5) The Council shall maintain a register of all employers registered under this Act, together with a record of any payments made.

5. Exemption from levy.

The Minister may, from time to time, by order published in the Gazette exempt fully or partly any of the employers or class of employers from the payment of the levy in such circumstances and subject to such conditions as may be pre- scribed in the order.

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PART III

ELIGIBILITY FOR FINANCIAL ASSISTANCE

6. Qualifying conditions.

(1) Subject to section 5, any employer who has paid the levy upon registration shall be eligible to receive any financial assistance or other benefit provided under this Act for the purpose of promoting the training of his employees.

(2) Where an employer has acquired the interests of another employer registered under section 4, the first-mentioned employer shall be substituted for that other employer and shall be eligible to receive or continue to be in receipt of any financial assistance or other benefit provided under this Act, as the case may be.

(3) Any employer who is in receipt of, or eligible to receive, any financial assistance or other benefit provided under this Act shall be disqualified from receiving such financial assis- tance or other benefit if he is in default of any payment of the levy and such disqualification shall remain until such time that all outstanding payments and interest thereon have been fully paid-up.

7. Penalty for obtaining money or benefit by false or misleading statement or document.

Any person who obtains any financial assistance or other benefit provided under this Act by means of any false or misleading statement or document shall be guilty of an offence and shall, on conviction, be liable to a fine not exceeding ten thousand nnggit or to imprisonment for a term not exceeding two years or to both.

8. Repayment.

Where a person is convicted of an offence under section 7 the court may, in addition to imposing a penalty under that section, order the person to make repayment of the amount of money or value of benefit wrongfully obtained.

PART IV

HUMAN RESOURCES DEVELOPMENT FUND

9. Establishment of Fund.

(1) For the purpose of this Act there shall be established a Human Resources Development Fund, into which shall be paid—

(a) all monies collected by way of levy under sections 3 and 5A;

(b) all monies recoverable from loans granted under this Act;

(c) all monies earned or arising from any property, investments, charges or debentures acquired by or vested in the Council; and

(d) any gift, donation, contribution or any other sums received from any source.

(2) The Fund shall be expended for the purpose of—

(a) the promotion, development and upgrading of skills of employees including the provision, establishment, expansion, upgrading or maintenance of training facilities;

(b) the provision of financial assistance to employers by way of grant, loan or otherwise for the purposes mentioned in paragraph (a) including defraying or subsidising the costs incurred by any employer in the training or retraining of his employees;

(c) carrying out, subject to such terms and conditions as may be approved by the Minister, of activities or proj ects to train or retrain retrenched persons or persons to be retrenched;

{d) paying any expenses lawfully incurred by the Council including any fees and costs, the remuneration of officers and servants employed by the Council, and allowances payable to any member of the Council, Investment Panel or any committee established under this Act; and

(e) generally paying any expenses for carrying into effect the provisions of this Act and in connection with the administration of the Fund.

10. Recovery of levy and loan.

Any levy payable or loan granted under this Act, together with any interest thereon, shall be a debt due to and be re- coverable by the Council.

11. Investment Panel.

(1) There shall be established an Investment Panel which shall, subject to such directions as may be issued by the Council, be responsible for matters pertaining to the investments of the Fund.

(2) The Investment Panel shall consist of—

(a) the Chairman of the Council or any person for the time being acting as Chairman of the Council, as Chairman;

(b) two members appointed by the Council from amongst its members;

(c) the chief executive of the Council;

(d) a representative from the Ministry of Finance;

(e) a representative from Bank Negara, Malaysia; and

(f) two other persons with business and financial expe- rience to be appointed by the Minister.

(3) A person appointed in accordance with paragraph (2) (f) shall serve for a period of two years from the date of his appointment.

(4) The provisions of the Second Schedule shall apply to the members of the Investment Panel.

12. Power to invest.

(1) The Investment Panel may, from time to time, invest the Fund or any part thereof not being monies immediately required for meeting the Fund's obligations and expenses—

(a) in investments or securities authorised for the invest- ment of trust funds by any written law for the time being in force; or

(b) in shares and debentures in any public company the prices of which are quoted or sought to be quoted on the stock exchange established in Malaysia; and

(c) in such other investments or securities as the Invest- ment Panel may decide:

Provided that any investment made under this Act may be varied, transposed or realised from time to time.

(2) The Minister in consultation with the Minister of Finance may, at any time, direct the vacation in part or in whole, or prohibit investment, in any security or class of securities.

(3) For the purposes of this section—

"debenture" includes debenture stock, bonds, notes or any other securities or obligations of a company, whether consti- tuting a charge on the assets of the company or not, and also includes the right to subscribe for any debenture;

"share" means the paid-up shares (whether fully paid or not) in the share capital of a company and includes stock and right to subscribe for any stock or share.

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PART V

HUMAN RESOURCES DEVELOPMENT COUNCIL

13. Establishment of Council.

There shall be established a Council called the "Human Resources Development Council" which shall be a body corporate with perpetual succession and a common seal and which may sue and be sued in its corporate name and, subject to and for the purposes of this Act, may enter into contracts and may acquire, purchase, take, hold and enjoy movable and immovable property of every description, and may convey, assign, surrender, yield up, charge, mortgage, demise, reassign, transfer or otherwise dispose of, or deal with, any movable or immovable property or any interest therein vested in the Council upon such terms as it thinks fit.

14. Council to be Trustee of Fund.

The Council shall be the Trustee of the Fund.

15. Members of the Council.

(1) The Council shall consist of fourteen members who shall be appointed by the Minister, of whom—

(a) ten persons shall be representatives of employers; and

(b) four persons shall be representatives of government or public sector agencies responsible for manpower development or training.

(2) The Minister may, in addition to the persons mentioned in subsection (1), appoint to be members of the Council not more than two persons who, in the opinion of the Minister, are able to contribute to the work of the Council.

(3) The Minister shall appoint among the persons mentioned in subsection (1) a Chairman and Deputy Chairman of the Council. The person appointed to be Chairman shall be a member appointed under subsection (l)(a).

16. Alternate members.

(1) The Minister may, in respect of each of the members of the Council other than the Chairman, Deputy Chairman and members appointed under section 12 (2), appoint a person to be an alternate member to attend meetings of the Council in place of the member when the member is for any reason unable to attend.

(2) When attending meetings of the Council in place of a member, an alternate member shall for all purposes be deemed to be a member of the Council.

(3) An alternate member shall cease to be an alternate member when the member in respect of whom he is an alternate member ceases to be a member of the Council.

(4) The provisions of the Third Schedule shall apply to the members of the Council.

17. Temporary exercise of functions of Chairman.

(1) If for any reason the Chairman is unable to attend a meeting of the Council or during the absence of the Chairman at a Council meeting, the Deputy Chairman shall exercise the powers of Chairman.

(2) In the event that both the Chairman and Deputy Chair- man are unable to attend a meeting of the Council, the remaining Council members shall elect from among themselves a person to be Chairman for the duration of the meeting and the person so elected shall be deemed to be temporarily exercising the powers of the Chairman.

18. Functions of the Council.

The functions of the Council shall be—

(a) to assess and determine the types and extent of employee training and retraining in keeping with the human resources needs of industries;

(b) to promote and stimulate manpower training; and

(c) to determine the terms and conditions under which any financial assistance or grant is to be given.

19. Powers of the Council.

The Council shall have power to do all things expedient or reasonably necessary for or incidental to the carrying out of its functions, and in particular, but without prejudice to the generality of the foregoing provisions—

(a) to collect and recover or cause to be collected and recovered all monies due to the Fund;

(b) to establish guidelines for processing applications to the Fund for financial assistance;

(c) to determine the terms and conditions for the making of grants or loans from the Fund, including the amounts that may be approved in respect of each application;

(d) to determine the proportion of monies of the Fund which should be used for grants or for loans, including the proportion that should be provided in the form of a grant or by way of a loan in respect of each approved application;

(e) to organize, establish, upgrade and maintain, or to assist in the organization, establishment, upgrading and maintenance of, training facilities;

(f) to organize and supervise, or to assist in the orga- nization and supervision of, the implementation of training courses, projects and programmes; and

(g) to examine any records, accounts and any other document relating to the grant, loan or any other benefit granted under this Act to any employer to ensure due compliance by the employer of the pro- visions of this Act.

20. Appointment of officers and servants of the Council.

The Council may appoint a chief executive to be designated as the Director-General and such other officers and servants as it considers necessary for the carrying out of its functions on such terms and conditions as may be determined by the Council.

21. Members, officers and servants deemed to be public servants.

The members of the Council and of the Investment Panel, the Director-General and the other officers and servants of the Council shall be deemed to be public servants within the meaning of the Penal Code.

22. Committees.

The Council may set up committees consisting of members of the Council or persons who are not members of the Council or a combination of both to advise or assist the Council on such matters concerning its functions as it considers fit, and the Council may delegate subject to such conditions or restric- tions as it may impose, such of its functions as it considers fit to any such committees.

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PART VI

EXECUTING AGENTS

23. Appointment of agent.

(1) The Council may, with the approval of the Minister, employ and pay agents to do any act required to be done in the exercise of its powers or for the better carrying into effect of the purposes of this Act.

(2) The Council shall enter into an agreement in writing with the agent employed under subsection (1) and such agree- ment shall specify the duties, responsibilities and obligations of the agent.

(3) The Council may, with the prior approval of the Minister,

issue to the agent such sums of money from the Fund to be held in trust by the agent, on such terms and conditions as may be imposed by the Council, for the purpose of carrying out the objects of this Act.

24. Duty of agent to maintain proper records.

(1) Any agent employed by the Council under section 23 shall keep and maintain proper and updated records and accounts of all matters connected with its duties, responsibilities and obligations.

(2) The Council shall have power to examine and audit the records and accounts of the agent.

(3) Any person who destroys, conceals, mutilates or alters any record or account required to be kept or maintained under subsection (1) that will result or is likely to result in financial loss to the Council shall be guilty of an offence and shall, on conviction, be liable to a fine not exceeding ten thousand ringgit or to a term of imprisonment not exceeding two years or to both.

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PART VII

ACCOUNTS AND AUDIT

25. Application of Statutory Bodies (Accounts and Annual Reports) Act 1980.

The provisions of the Statutory Bodies (Accounts and Annual Reports) Act 1980 shall apply to the Council.

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PART VIII

GENERAL PROVISIONS

26. Offences by body corporate.

Where an offence under this Act is committed by a body corporate, any person who at the time of the commission of the offence was a director, manager, secretary or other like officer of the body corporate, or was purporting to act in any such capacity, shall as well as such body corporate be deemed to be guilty of that offence unless he proves that the offence was committed without his consent or connivance and that he exercised all such due diligence to prevent the commission of that offence as he ought to have exercised, having regard to the nature of his functions in that capacity and to all the circumstances.

27. Regulations.

The Minister may make regulations prescribing all matters and things required by this Act to be prescribed, or which are necessary or expedient for giving full effect to the provisions of this Act, for the carrying out of or achieving any purposes of this Act or any provision thereof, or for the further, better or more convenient implementation of the provisions of this Act.

28. Power of Minister to give directions.

The Council shall be responsible to the Minister, and the Minister may give directions not inconsistent with the provi- sions of this Act and the Council shall, as soon as possible, give effect to all such directions.

29. Appeals.

(1) Any person who is aggrieved by a decision of the Council or its agent may, within thirty days from the date on which the notice of the decision of the Council is served on him, appeal to an appeal committee comprising three members who are not members of the Council, established and appointed by the Minister.

(2) The decision of the appeal committee shall be final and conclusive.

(3) A member of the appeal committee may be paid such allowances as may be determined by the Minister. 30. Secrecy.

(1) Except for any of the purposes of this Act or for the purpose of any civil or criminal proceedings under this Act, no member, officer, servant or agent of the Council shall disclose any information which has been obtained by him in the course of his duties under this Act.

(2) Any person who contravenes subsection (1) shall be guilty of an offence and shall, on conviction, be liable to a fine not exceeding two thousand ringgit or to imprisonment for a term not exceeding six months or to both.

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