EditorialMPF scheme must move with the times to better meet worker needs
Without excessively burdening businesses in this tough economic environment, the MPF authority needs to make changes
As a result, the authority now proposes more punitive surcharges in such cases. It’s about time. The current penalty is too lenient. At present, the surcharge for late payment is a flat rate of 5 per cent, regardless of how long employers take to settle the amount. That is clearly not enough of a deterrent.
The MPFA issued, on average, a whopping 31,000 notices every month to employers who failed to make MPF contributions on time. About 16 per cent of non-compliant bosses settled the outstanding contributions and surcharges within the two-week deadline and only about half of them settled the full amounts within four months.
Some employers’ representatives have tried to blame the eMPF, the centralised online platform, for late payments because the system is supposedly confusing and not user-friendly. While the digital system can certainly improve, it is not an excuse for late payments or not paying at all.
In fact, such behaviour may raise red flags about potentially unscrupulous bosses closing business without warning to avoid paying workers – a not uncommon practice in commercial sectors such as restaurants.