Thursday 28 Mar 2024
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KUALA LUMPUR (Dec 6): Some 300 ex-employees of Lion Group’s 79%-owned Megasteel Sdn Bhd could at least receive their unpaid salary, which make up half of some RM6.66 million claimed from the steelmaker last year, amid halting of its operations since 2016.    

Deputy Human Resource Minister Datuk Mahfuz Omar told this at the Dewan Rakyat today, when addressing companies who take steps to restrain assets from being liquidated by creditors, which indirectly denies compensation to affected employees as well.

“56 cases have been filed by employees of Megasteel Sdn Bhd from Feb 14 to Feb 24, 2017, involving 300 ex-employees, with claims amounting to RM6.66 million,” Mahfuz said.

“I have been made to understand by my officers in the ministry that discussions have been conducted between the human resource department with liquidators and representatives of the employees, to look into the necessity of taking steps to facilitate the payment of claims.

“In principal, I understand that [the related parties] have agreed to satisfy around half of the claims, which represents unpaid salary of the employees,” he said. 

Mahfuz was responding to questions brought up by Abdullah Sani Abdul Hamid [PH-Kapar] on how the government will address the plight of ex-employees.

To recap, loss-making Megasteel defaulted some RM3 billion worth of loans in 2015. It ceased operations of its Banting plant in 2016, amid poor market conditions. 

Mahfuz said Megasteel had obtained a restraining order from the High Court on the liquidation of its assets, which would stand until Dec 21 this year.

Although the parties have agreed in principal to facilitate payments, Mahfuz said the matter is still being deliberated, as parties look into the liquidity of Megasteel’s assets for sale.

“It is not impossible that the company will apply for a fresh restraining order, after the current one expires. These are some of the hurdles that could stall proceedings,” he said.

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