National Recovery Plan: Standard Operating Procedure for Construction Industry

Following the Malaysian Government’s announcement of the National Recovery Plan, which is intended to be the country’s exit strategy in relation to the COVID-19 pandemic, the Construction Industry Development Board of Malaysia (‘CIDB’) has published the standard operating procedure (‘SOP’) for the construction industry.1 The SOP varies depending on the phase of the National Recovery Plan that a state is categorised under.
 
This Alert outlines and compares the key aspects of the SOP for the construction industry for Phases 1 to 3 of the National Recovery Plan. Aside from such key aspects as set out herein, the on-site protocols with respect to the sanitisation of common areas, movement of workers, and social distancing measures are reflective of the previous requirements imposed during the movement control orders2 and apply to all three Phases.
 
TYPE OF CONSTRUCTION WORKS ALLOWED
 
Phase 1
  • Critical maintenance and repair works which, if left unattended, could cause danger or harm to workers, members of the public or the environment.
  • Public infrastructure or government-funded projects.
  • Construction works with approved on-site workers’ accommodation or centralised labour quarters.
  • Construction works carried out by Grade 1, Grade 2, Grade 3 or Grade 4 registered contractors.
  • Construction works on hospitals with certified physical progress of 80% and above.
  • Renovation works for personal residences.
  • Soil investigation works.
  • Professional, consultancy or supply chain services in relation to the above works.
  • Any construction works that are not listed above, but the requisite vaccination rate of employees has been achieved (see table below).
 
Phase 2
  • Any maintenance and repair works.
  • Public infrastructure or government-funded projects.
  • Construction works with approved on-site workers’ accommodation or centralised labour quarters.
  • Construction works carried out by Grade 1, Grade 2, Grade 3 or Grade 4 registered contractors.
  • Highways or roadworks.
  • Construction works on hospitals with certified physical progress of 80% and above.
  • Soil investigation works.
  • Renovation works for personal residences or buildings.
  • Site preparatory works such as setting out, site clearing and earthworks.
  • Professional, consultancy or supply chain services in relation to the above works.
  • Any construction works that are not listed above, but the requisite vaccination rate of employees has been achieved (see table below).
 
Phase 3   All types of construction works.
 
It is pertinent to note that in order to operate in states categorised under Phase 1 or Phase 2, contractors are required to apply for approval from the Ministry of International Trade and Industry (‘MITI’).
 
WORKFORCE CAPACITY AND VACCINATION RATE
 
The percentage of workforce capacity allowed under each Phase of the National Recovery Plan is as set out below:
 
NATIONAL RECOVERY PLAN WORKFORCE CAPACITY
Phase 1 60%
Phase 2 80%
Phase 3 100%
 
 
Notwithstanding the above, workforce capacity may be increased subject to the following:
 
  1. The percentage of employees that are fully vaccinated3, the range of which is set out below:
 
VACCINATION RATE WORKFORCE CAPACITY
80% - 100% 100%
60% – 79% 80%
40% - 59% 60%
 
 
  1. The Rapid Test Kit (RTK) Antigen test has to be conducted on employees every two weeks, at the employer’s own cost.
 
Contractors should be mindful that they are required to declare the percentage of employees that are fully vaccinated through MITI’s online COVID-19 Intelligent Management System (‘CIMS’).
 
OPERATING HOURS
 
Companies are allowed to maintain their standard operating hours regardless of the Phase of the National Recovery Plan that their applicable state is in. However, this is subject conditions that may be imposed by the local authority.
 
MOVEMENT OF WORKERS BETWEEN SITES
 
Workers are not allowed to move between sites for construction works located in states categorised under Phase 1 or Phase 2. For states categorised under Phase 3, workers are allowed to move between sites provided that they undergo COVID-19 testing three days prior to entering the new site.4
 
ALL CONSULTANCY SERVICES ALLOWED TO OPERATE
 
In addition to the above, CIDB has announced that all consultancy services located in states categorised under Phase 1 or Phase 2 of the National Recovery Plan are allowed to operate with effect from 24 August 2021.5 Consultants are required to apply for approval to operate through MITI’s CIMS.
 
In applying for approval, consultants will need to select any of the following sectors:
 
  • Sector 27: Professional or consultancy services in relation to works that are allowed.
  • Sector 32: Office operations.
  • Sector 33: Other works or activities not listed in Sectors 1 to 32. If Sector 33 is selected, consultants will only be allowed to operate based on the declared vaccination rate of their employees.
 Consultancy services operating are also bound by the SOP for the construction industry as described above.
 
COMMENTARY
 
The gradual resumption of operations in the construction industry will no doubt be welcome news to developers, contractors, and consultants. However, with daily new COVID-19 cases still hovering around 20,000, companies will have to exercise a great deal of caution and comply fully with the SOP in order to maintain the fragile balance between business and health.
 
Alert prepared by Rachel Chiah (Senior Associate) of the Construction and Engineering Practice Group of Skrine
 

1 The full text of the SOP on CIDB’s website is available here.
2 Our summary of the applicable on-site protocols and requirements for construction works is available here.
3 “Fully vaccinated” means an individual has received two doses of vaccination and 14 days has passed since the date of his second dose (for Pfizer, AstraZeneca and Sinovac vaccinations) or an individual has received his single dose of vaccination and 28 days has passed since the date of the said dose (for Johnson & Johnson and CanSino vaccinations).
4 The announcement posted on CIDB’s official Twitter account on 1 September 2021 is available here.
5 The full text of CIDB’s announcement on consultancy services is available here.

This alert contains general information only. It does not constitute legal advice nor an expression of legal opinion and should not be relied upon as such.