Staff Training Fund for Bankers

I believe not many are aware on the existing rules of Staff Training Fund under the Bank Negara Malaysia. The rules in general to avoid the financial institution from pinching other bank staff. Currently those earning RM4,000 and above are subject to this rules.

The new employer have to pay RM equivalent to 6 months salary (in the new bank) to this fund. This fund will be used for training and one of it is for FSTEP programme.

For those from other industries are not subject to this rules, and  use this fact in bargaining good salary package.

The Guidelines on Staff Training Fund were first introduced in 1985 to encourage banking institutions to train their own personnel rather than resorting to drawing staff from other financial institutions. Under the Guidelines, banking institutions that resort to staff pinching had to contribute to the Staff Training Fund administered by Institut Bank-Bank Malaysia (IBBM).

As the banking sector develops, it has become increasingly crucial for banking institutions to be able to attract the best talent, particularly in areas where there are still shortages of skills such as risk management, systems development and alliance building. Hence, the wage moratorium was uplifted in 2000 to provide greater autonomy for banking institutions to determine the remuneration of employees based on productivity and performance.

The STF is applicable if the recruitment is made within 6 months of the staff’s resignation and whose previous salary exceeds RM2,000 per month. In 1993, rules pertaining to “staff pinching” were liberalised where “staff pinching was redefined to refer to the recruitment of new staff who were not approved for release by the previous employer.

In line with this liberalisation, the penalty on staff pinching would be removed gradually. Hence, the Guidelines on Staff Training Fund were reviewed, whereby the scope of coverage has been narrowed to staff with a monthly gross salary of RM4,000 compared to RM2,000 previously. As a deterrent against recruiting experienced personnel from another financial institution, the hiring institution is required to contribute a maximum of 6 months of the personnel’s new gross salary to the STF.

For more details about banking industry, kindly visit banking.tips.my

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Tags: BNM, career in banking, FSTEP, guide, staff training fund

Category: Career Tips, Employer