HRDC Employer Guide

A Comprehensive Guide to Registration, Levy, and Training Claims

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Maximizing Your Training Budget

Training costs can be significant, but Malaysia’s Human Resources Development Fund (HRDF), managed by HRD Corp, provides a legal mechanism for employers to offset these expenses. This guide explains the regulations, including registration requirements, levy calculation, and the process for claiming training grants.

Key Points

  • Mandatory Registration: Employers with 10 or more Malaysian employees must register with HRD Corp; those with 5–9 employees may register voluntarily.
  • Levy Rates: Mandatory contributors pay a 1% monthly levy on employees’ wages; voluntary contributors pay 0.5%.
  • Deadlines: Levy payments are due by the 15th of the following month; late payments incur 10% annual interest.
  • Eligible Claims: Registered employers can claim costs for upskilling, apprenticeships, and training-related IT equipment.
  • Non-Compliance: May result in fines up to RM10,000, imprisonment up to 1 year, or both.

What Is HRDF (HRD Corp)?

HRDF, officially known as HRD Corp, is a statutory body under the Ministry of Human Resources, governed by the Pembangunan Sumber Manusia Berhad Act 2001 (PSMB). Formerly known as HRDF, the organisation was rebranded in 2021 as HRD Corp (Human Resources Development Corporation).

Purpose of HRDF

HRDF’s mission is to strengthen Malaysia’s workforce by supporting skills development, enhancing business performance, and reducing reliance on foreign labour through a highly skilled local workforce.

Step-by-Step Registration Process

1. Check Eligibility

Confirm your company falls under the First Schedule of the PSMB Act 2001.

2. Prepare Documents

Gather Form 1, business registration papers, and latest EPF statement.

3. Submit via e-TRiS

Register online at hrdcorp.gov.my and create your login ID.

4. Await Approval

Upon approval, you receive an Employer Code and levy start date.

How the Levy Is Calculated

The levy applies to basic salary + fixed allowances (transport, housing, shift) but excludes overtime, bonuses, and commissions.

HRDF Levy = (Basic Salary + Fixed Allowances) × Levy Rate

Note: Payments must be made by the 15th of every month.

Eligible Claims & Benefits

Employers can claim under HRD Corp’s Levy Grant System for various activities:

  • Upskilling & Reskilling: SBL, SLB, OJT, CBT, and RPL schemes.
  • Future Workers: Industrial Training Schemes for students and new hires.
  • Internal Training Setup: Claim IT equipment, facilities, and renovations (ALAT).

Benefits: Employers gain a dedicated training budget and improved productivity, while employees gain future-ready skills and career growth.

Penalties for Non-Compliance

Failure to register or pay the levy is a serious offense under the PSMB Act 2001:

  • Fines up to RM10,000
  • Imprisonment up to 1 year
  • 10% annual interest for late levy payments