HRDF Program

(The minimum entry requirement for the certificate courses is PMR or equivalent)


In the quest to attain the status of a developed country by the year 2020, greater emphasis must be given to the retraining and skills upgrading of the workforce. This is necessary not only to increase the knowledge and skill intensity of the workforce, but also to equip them with specialised and up-to-date skills as production techniques become increasingly automated and businesses competitive. Retraining and skills upgrading is also of paramount importance to enhance the quality of the workforce so that it is versatile and adaptable to the changing technological and business environment.

With that in mind, the Human Resources Development Act, 1992 was enforced in January 1993 and led to the establishment of the Human Resources Development Fund (HRDF) which is administered by the Human Resources Development Council (HRDC). In line with the corporatisation exercise via the Pembangunan Sumber Manusia Berhad Act 2001, HRDC is now known as Pembangunan Sumber Manusia Berhad (PSMB).

Human Resources Development Levy

The Human Resources Development Levy is the mandatory levy payment imposed by the Government on specified groups of employers for the purpose of employee training and skills upgrading. Under the law, certain categories of employers are liable to pay a Human Resource Development levy for each working employee at the rate of 1.0% of the monthly wages of the employee. However, the Minister of Human Resources may, from time to time, by order published in the Gazette, reduce or increase the rate of the levy specified. The minister is also empowered to exempt fully or partially any of the employers from the payment of this levy.


Categories of Employers Covered Under the PSMB Act, 2001

i).      Employers with fifty employees and above in the manufacturing sector (w.e.f. 1 January 1993);

ii).     Employers with ten to forty-nine employees and a paid-up capital of RM2.5 million and above in the manufacturing sector (w.e.f. 1 January 1995);

iii).    Employers with 10 employees and above in twenty-one selected industries in the services sector, namely, the hotel industry, tour operating business (in-bound tour only), shipping, air transport, telecommunication, computer services, advertising, postal & courier services and freight forwarding (w.e.f. 1 January 1995); private higher education, training and the energy sector (w.e.f. 17 February 2000); and direct selling, port services, engineering support and maintenance services, research and development, warehousing services, security services, private hospital services and hypermarkets, supermarkets and departmental stores – (w.e.f. 1 January 2005). For hypermarkets, supermarkets and departmental stores, only employers with 50 employees and above are required to register. Commercial land transport and railway transport services industry with 10 employees and above (w.e.f. 1 December 2007)

iv).   Employers in the manufacturing sector with ten to forty-nine employees and a paid-up capital of less than RM2.5 million are given the option to register with PSMB (w.e.f. 2 August 1996).  

Under Regulation 4(1) of the Pembangunan Sumber Manusia Berhad (Registration of Employers and Payment of Levy) Regulations 2001, employers have 30 days to register with PSMB from the date they are liable. Employers falling in any of the categories elaborated are still liable to register with PSMB under the Pembangunan Sumber Manusia Berhad Act, 2001. Those who have yet to register are advised to do so, failing which legal actions shall be taken against them.

Eligibility For Training Grant

Employers registered and / or incorporated in Malaysia who have registered with PSMB and pay the HRD levy immediately upon registration are eligible to apply for training grants (financial assistance) to defray all or a major portion of the “allowable costs” of training their employees. Training must be in the area of direct benefit to their business operations. Financial assistance is, therefore, not given to individuals who enrol and finance their own training programmes, whether partially or fully, and subsequently requested their employers for sponsorship. Neither is financial assistance given to employers who bear the cost of training after the successful completion of training by their employees. 

Rate Of Financial Assistance

The HRDF is not a subsidy scheme for the retraining and skills upgrading of workers by employers. As the HRDF will provide financial assistance to defray all or a major portion of the “allowable costs”, all retraining and skills upgrading programmes undertaken by employers should be seen as cost-sharing efforts. 

The rates of financial assistance with effect from 1 November 2008 are as follows:- 

Types of training

(a) Skills Areas
Rate of Financial Assistance, Subject to the Maximum Allowable Costs
  1. Technical Skills
100%
  2. Craft Skills
100%
  3. Quality And Productivity Related Skills
100%
  4. Computer-related skills
100%
  5. All Other Retraining & Skills Upgrading
100%

100% (remain permanent at 100% with effect from
1 November 2008)
  6.Overseas Training 50%(w.e.f.  1 July 2002 – the rate of financial assistance had been increased from 50% to 100% for retraining and skills upgrading in advanced technologies, new technologies, development of new products, research and development, engineering, marketing and strategic management)
(b) Purchase of Training Equipment and Setting up of Training Room
100% (subject to 20% of the amount of levy paid in the preceding year)
(c) Purchase or Development of Computer-Aided Software (The rate of financial assistant is dependent on the skill areas).
85%-100%
(d) Apprentice Scheme
100%
(e) Lecturers of Private Institutes of Higher Education undergoing retraining in Engineering, Computer Technology, Medicine and Teaching.
100%

 

Payment Of The HRD Levy

For the payment of the HRD levy, PSMB has appointed Public Bank Berhad and RHB Bank Berhad as its collection agents throughout the country. PSMB’s account numbers at the two banks are as follows:-

       i).      Public Bank Berhad   - 3999060003

      ii).      RHB Bank Berhad      - 21433437000066 


Eligibility Of Employers

All employers registered with PSMB and have paid the Human Resources Development levy upon registration are eligible to apply for training grants, subject to the stipulated rate of financial assistance to defray the total or part of the training costs for employees 

Application For Training Grants

Employers undertaking the retraining and skills upgrading of their employees through any mode of training can apply for training grants under any of the training schemes established by PSMB. 

Training Schemes Under PSMB

To facilitate employers to send their employees for training, PSMB has introduces various training schemes as follows:-

SBL Scheme
SBL-Khas Scheme
Annual Training Plan Scheme  
- Juruplan Scheme
- SME Training Needs Analysis Consultancy Scheme
PROLUS Scheme
PERLA Scheme
Joint Training Scheme
Apprenticeship Scheme
SME Training Partners (SMETAP) Scheme
Computer-Based Training Scheme
Information Technology and Computer-Aided Training Scheme
Purchase of Training Equipment and Setting Up of Training Room Scheme
English Language Programmes for Workers under the HRDF
Industrial Training Scheme
SME On-The-Job Training

Claims For Training Grants 

Claims for training grants for completed programmes in the current year should be submitted not later than 30 June of the following year.  Financial assistance in respect of approved “allowable costs” will be reimbursed on a claimed basis. The amount reimbursed is subject to the approved amount or actual expenses borne by employers, whichever is the lesser and to the availability of funds in employers’ accounts.

Human Resources Development Conference & Awards

PSMB also organizes an annual conference with the aim to keep HR professionals abreast with the latest HR challenges, human capital development tools and approaches to achieve organizational excellence. Apart from gaining information on products, services and business solutions, it also provides networking opportunities for employers, individuals and entrepreneurs.

In conjunction with this conference, the HRD awards were introduced and given to employers, both big and small and medium-sized employers who excelled in the development of human resources within their organizations. To recognize their achievements and training providers in the country, the Human Resources Development Awards, namely, the Human Resources Minister’s Awards and the Pembangunan Sumber Manusia Berhad Awards were introduced. The annual awards were divided into three categories i.e. big employers, small & medium sized employers and training providers.