There is this famous business conversation between a CEO and CFO which goes like this:
CFO asks: What if we spend money on training our employees and they leave?
CEO replies: What if we don’t and they stay
Developing an effective employee training program is vital to the long term success of a business. Many employer finds the training cost expensive and employees may miss out work time while attending training.
HRDF fund presents a good opportunity by providing both the business and employees with benefits that make the levy payment and time a good investment.
What is HRDF Fund?
Human Resource Development Fund (HRDF) also known as Pembangunan Sumber Manusia Berhad (PSMB) is a company limited by guarantee under the Ministry of Human Resources. The objective of HRDF is to enhance the knowledge and skills of Malaysian workforce through continuous retraining and skills upgrading via levy/grant system.
What are the benefits of registering with HRDF?
- Systematic and structured training plan for workers
- Free advisory services under NHRC
- Levy payment is considered as allowable expenses under the Income Tax Act, 1967
- Free Training Needs Analysis
- Employees are equipped with specific and up-to-date skills
- Achieving faster technology transfer
- Preventing employees’ skills from becoming obsolete in the ever changing technological environment
- Having a multi-skilled workforce in meeting with market demands
- Improving the quality of their services
Employer should take the opportunity to take the Free Training Needs Analysis (TNA) provided by HRDF to identify the training needs and implement the training programmes to retrain or upgrades the skills.
Who Is Required To Register With HRDF?
The expansion of the PSMB Act 2001, which came into effect in April 2017 required employers to register with HRDF within the grace period till 30th September. Read here for more details.
Employers from the manufacturing, services,mining and quarrying sectors are required to register and pay levy on each of its local employee.
Check below if your company (service sector) is required to register with HRDF by submitting Employer Registration Form (Form 1) and Employer Information Form (Form 1A):
What are the available HRDF scheme?
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