Pembangunan Sumber Manusia Berhad Act 2001

Objectives: An Act to encourage employers covered under the

Pembangunan Sumber Manusia Berhad Act, 2001 to retrain and upgrade the
skills of their employees, apprentices and trainees in line with their business
needs and the development strategy of the country.

Administer By: Pembangunan Sumber Manusia Berhad, Malaysia

Meaning and Interpretations

1. The Human Resources Development Fund (HRDF) was launched off to

encourage direct private sector participation in skills development
programs.
2. Coverage and Rate of Levy
a. Employers under the category of manufacturing and services are
liable to register and pay the Human Resources Development levy.

Sector No of Paid Up Capital Mandatory/

Employees Optional Levy
Rate

Manufacturing 50 and above Any amount Mandatory 1%

10 49 2.5m and Mandatory 1%

above

10 - 49 Less than 2.5 m Optional 0.5%

Services 10 and above Any amount Mandatory 1%

(21 industries)

b. An employer has 30 days to register with PSMB from the date they
are liable. (Regulation 4(1))
c. An employer who is liable to pay the HRD levy shall pay those levies
for the first and subsequent months wages commencing from the
date the employer becomes liable.(Regulation 7)
d. The payment of the HRD levy is the responsibility of the employers.
e. The wages of employees is not permitted to be deducted under
any circumstances for the payment of the levy.
f. Monthly wages means the wages paid by an employer to an
employee for the whole or part of the month during which the
employee is employed by the employer.
g. Employee means any Malaysian citizen who is employed for wages
under a contract of service with an employer, but does not include
any domestic servant.
3. Eligibility For Training Grant
 a. Employers registered and/or incorporated in Malaysia who have
registered with PSMB and paid the HRD levy within a month after
registration are eligible to apply for training grants (financial assistance)
to subsidise all or a major portion of the allowable costs of training
their employees.
b. Training must be in the area of direct benefit to their business
operations.
c. Employer undertaking the training programmes for their employees
through any mode of training can apply for training grants under any
of the training schemes offered by PSMB.
d. The payment of training grants will be subject to the terms and
conditions imposed by PSMB from time to time and may be withdrawn
by the Corporation for any breach of any of the terms and conditions
imposed.
e. To be eligible for training grants under the HRDF, trainees must be
employees who are Malaysian Citizens

Key Implications

1. Employers under the category of manufacturing and service sectors

(listed below are eligible to pay the HRDF levy.

List of 21 industries under the service sector

2 Energy 2 Freight Forwarding 2 Engineering

2 Hypermarket/ 2 Shipping Support &
Supermarket/ 2 Air Transport Maintenance
Departmental 2 Tour Operating Services
Store (only those Business (In-bound 2 Security
with employees only) Services
numbers of 50 2 Postal or Courier 2 Computer
and above) 2 Telecommunication Services
2 Direct Selling 2 Research and 2 Advertising
2 Commercial Development 2 Private
land transport Hospital
and railway Services
2 Warehousing 2 Higher
Services Education
2 Port Services 2 Training
2 Hotel Industry

2 Employers who have registered and pay the levy may apply for
training grants for any mode of training given to their Malaysian
employees.