MoHA finalising plans to impose foreign worker levy Employers will be penalised for not meeting the ratio of locals in new labour regulations

BANDAR SERI BEGAWAN — The Ministry of Home Affairs (MoHA) is finalising plans to impose a levy on employers who do not meet the ratio of local-to-foreign workers in eight specific industries. 

The ministry has already set the levy amount — although it has not disclosed the figure — and will implement it with the cooperation of the Manpower Planning and Employment Council, the home affairs minister said during the Legislative Council (LegCo) session on Saturday.

YB Pehin Orang Kaya Seri Dato Seri Setia (Dr) Hj Abu Bakar Hj Apong said MoHA still needs to streamline procedures before enforcing the Foreign Workers Levy and did not provide a time frame on its enforcement.

The minister made the remarks in response to question posed by LegCo member YB Hj Mohimin Hj Johari.

The government has been tightening rules on hiring of foreign workers with the introduction of the Local and Foreign Workforce Ratio in 2019, which requires employers to prioritise locals for job vacancies and limit the number of foreign workers in eight sectors.

Those sectors are construction; retail and wholesale; education; transportation and storage; accommodation and food services; manufacturing; professional, scientific and technical services; and administration.

Employers who do not meet the local-to-foreign workers would then be obliged to pay the Foreign Worker Levy.

Before the introduction of workforce ratio, the government created a labour processing system in 2016 called the Foreign Workers License, that requires companies to submit proof that they have advertised vacancies on JobCentre Brunei before they can hire foreign staff.

The government’s move to increase local employment and limit the number of migrant workers has seen some early success.

According the 2019 Annual Census of Enterprises, Brunei’s private sector hired more locals than foreign workers for the first time in years.

However, the construction sector is still heavily dependent on foreign workers, who make up 78 percent of the total workforce.

Locals represented 66.5 percent (147,400 persons) of Brunei’s workforce, according to the Labour Force Survey 2019.