The government has increased the guarantee money to operate a recruiting agency to Rs 60 million, a 20-fold increase in the existing amount.

The Cabinet on Friday passed the Ministry of Labour, Employment and Social Security’s proposal to increase the guarantee money.

Currently recruiting agencies pay Rs 3 million guarantee money—700,000 as cash deposit and 2.3 million as bank guarantee to run their business.

Labour Minister Gokarna Bista proposed the 20 times increase in guarantee money to deter and limit the number of employment agencies. His noble aim was to eliminate the high incidence of dubious agents cheating of naïve migrant workers.

“Manpower companies have mushroomed in the country.

Many of them have been cheating workers. We hope most of wrongdoing will come down with the new guarantee money,” said Minister Bista.

The ministry increased the guarantee money steeply to make provision to compensate migrant workers, cheated by agent or employer, and to bail out Nepali workers languishing in prisons abroad.

The new guarantee money would vary depending upon the number of workers each agency dispatches to foreign countries annually.

Agencies that send more than 5,000 workers to various foreign countries would have to deposit Rs 20 million in cash and Rs 40 million as bank guarantee.

Agencies that send less than 5,000 workers would have to deposit Rs 10 million in cash and Rs 20 million as bank guarantee.

The labour ministry had proposed various amendments, including hike in guarantee amount, to the Foreign Employment Act (2007).

The Cabinet also decided to scrap all agents working for various recruiting agencies, but permitted them to open their branches outside Kathmandu Valley.

Among other amendments to the act, Minister Bista said, the Chief District Officer (CDO) is now empowered to investigate into individual cases of migrant workers cheated by agents.

Foreign missions can now renew work permits of Nepalis in foreign countries only twice and Nepali embassies can authenticate demand letters of recruiting agencies are other provisions to be amended in the act, which the Cabinet has passed.