KUALA LUMPUR, Dec 16 — Aviation companies must make contributions to the Social Security Organisation (Socso) on behalf of their employees as part of their licensing conditions, aviation industry regulator Malaysian Aviation Commission (Mavcom) said today.
Mavcom executive chairman Datuk Seri Saripuddin Kasim however said that failure to make Socso payments would not necessarily result in an aviation company being denied a licence from the commission.
“Talking about compliance, actually all the licensees — they are subjected to these licence conditions that we impose. One of the conditions — they must comply to contribute to the statutory contribution to EPF, Socso and so forth.
“After the pandemic, especially, we find that some of them fail, some of the industry players failed — not all — to contribute to Perkeso for example, some of them having problems,” he said in a press conference immediately after Mavcom and Socso signed a Memorandum of Understanding (MoU), referring to Socso by its Malay acronym Perkeso.
Saripuddin said Mavcom would then want to know whether these aviation companies had approached Socso to resolve the problem of unpaid contributions for their workers, such as by working out agreements for the contributions.
“Some of them encounter financial difficulties, but they have to approach the respective statutory bodies. If there is some sort of agreement, we are ok with it, but we just want to ensure all the employees’ welfare are taken care (of), they are not running away from responsibilities,” he said.
Under Malaysia’s laws, employers must pay statutory contributions — contributions that are legally required — such as to Socso and Employees Provident Fund (EPF) on behalf of their employees.
“Before licence is issued or renewed to any particular company, statutory contribution is one of the areas we look into. There are other aspects — financial prospects, financial health — of these companies. So this is one of the aspects that we look into, not because they did not contribute to Perkeso, then we did not renew the licence, it is not so,” he later added.
Mavcom is Malaysia’s civil aviation regulator and currently oversees 60 licence and permit holders, including air service licence holders, air service permit holders, ground handling licence holders, and aerodrome (airport) operating licence holders.
In other words, Mavcom regulates and oversees those who hold licences to operate passenger and cargo flights, ground handling services, and airport or commercial air fields.
Socso group CEO Datuk Seri Mohammed Azman Aziz Mohammed, who was also present at the same press conference, clarified that only a small number of aviation industry companies fail to comply with the need to pay Socso contributions.
“I would say it is not critical, it is not rampant,” he said.
“I would say it’s just small number of companies within aviation. Maybe they are not aware. Actually during Covid-19, it happened maybe because they want to reduce their cost, but post-Covid-19, maybe either they continue or oversee.
“Maybe they don’t put that as priority to register and also to contribute. That is the reason why it continues. I would say it is not rampant, it is just small numbers,” he said.
As part of the partnership inked between Socso and Mavcom today, the two organisations will exchange data on aviation companies’ compliance on Socso registrations and Socso payments.
“As a result of this partnership, enforcement procedures may be expedited, enabling Mavcom to conduct immediate investigations and address any instances of non-compliances among our licence and permit holders,” Saripuddin said.
