The employment of a non-resident employee in Sabah is subject to the provision of Section 118 of the Labour Ordinance (Sabah Chap. 67). Every employer in the state who employs non-resident employee is required to obtain a license from the Director of Labour, Sabah as stipulated in the stated provision quoted below:-
“Section 118 : No person shall employ any non-resident employee unless he has obtained from the Director a License to Employ Non-Resident employee.”
(2) Features of a suitable employer
a) The business operation carried out by the applicant (employer) must be legal and supported by strong financial background;
b) The applicant (employer) has not committed any offence in respect of any contravention of any of the provisions of the labour laws or other related legislations;
c) The applicant (employer) shall insure all the non-resident employees in his employment under the Workmen’s Compensation Scheme as stated under the Workmen’s Compensation Act 1952;
d) The service of the non-resident employees intended to be employed is genuinely required by the applicant (employer); and
e) The rate of wages offered to the non-resident employees must be similar to the rate of wages offered to local employees.
(3) Economic Sector and Category of Employment Permitted
ii. General worker in sector:-
(4) Nationalities of foreign employee allowed
i. Indonesian nationality
ii. Filipino nationality
(5) Duration of License to Employ Non-Resident Employee
Valid for a period of one (1) year only and renewable on a year to year basis.
(6) Employment contract for Non-Resident Employee
Every non-resident employee employed must enter and sign an employment contract with his employer for duration of one year which is extendable on of a year to a year basis.
(7) Protection under an approved Insurance Scheme
Every employer shall insure each and every non-resident employee (except those employed as domestic servants) under the Workmen’s Compensation Scheme provided for under the Workmen’s Compensation Act 1952.