Let us recover from post-pandemic first, MEF says on minimum wage hike

SHAH ALAM - Bosses have asked Putrajaya to review the decision to hike minimum wages to RM1,500 from May 1 onwards, further urging for "reasonable " time to recover from lockdowns and the worst floods in December.

Malaysian Employers Federation (MEF) President Datuk Syed Hussain Syed Husman said micro, small and medium enterprises (MSMEs) are still struggling after Covid-19 and massive floods in Dec.

He urged Human Resources Minister Datuk Seri M. Saravanan and Entrepreneur Development and Cooperative Minister Tan Sri Noh Omar to consult with stakeholders to review the wage hike.

“MEF is of the view that the MSMEs, which constitutes about 98 percent of all businesses in Malaysia, should be given a reasonable time to recover their businesses before implementing the new hike,” he said. Many stakeholders, he said the sudden increase of 25 percent to 36 percent wages puts huge financial pressure on the businesses, especially on those still recovering.

He further said the wage hike only involves companies with five employees or more, the federation hopes the government would reconsider extending it to companies with 20 employees.

“MEF appeals to the government not to implement the RM1,500 minimum wages across the board but rather based on affordability of the individual business, sectors and industries. For instance, hotels and the tourism industry are still affected post-Covid, Syed Hussain said.

MEF further suggested the government review the high cost imposed on employers to hire foreign laborers and urged the government to negotiate maximum ceiling charges to recruit them.

For instance, he said it cost RM20,000 to RM25,000 to recruit a Bangladeshi or an Indonesian worker while the estimated cost of quarantine was between RM2,000 and RM3,000, which includes accommodation, food (three times a day), transportation to the quarantine centre and Covid-19 screenings during the quarantine period.