Tuesday, March 22, 2022

MINIMUM WAGE MUST NOT BE A POLITICAL TOOL

 

PRESS STATEMENT



MINIMUM WAGE MUST NOT BE A POLITICAL TOOL

DELAY FOR SMALL BUSINESS WILL BE DISCRIMINATION

MTUC Sarawak welcome the announcement that minimum wage will be increased to RM1500 wef 1 May 2022 but is very concerned that the National Minimum Wage policy has been hijacked for political expediency.


The minimum wage, policy with the enactment of the National Wages Consultative Council Act (NWCC) was implemented as one of the policy tool to push Malaysia towards a high income nation.


The minimum wage policy is intended to ensure that the basic needs of workers and their families are met, protect them from exploitation, and to incentivise firms to move up the value chain by investing in technology and boosting productivity.


The minimum wage policy is envisaged to have an important role in addressing inefficiencies in the labour market, and in improving the social welfare of low-paid workers. It would alleviate labour market distortions and maximise the efficiency of labour usage in the economy. 


In Malaysia, real wages have recorded a slower growth compared to real labour productivity.


When wages have been artificially suppressed below productivity levels, it would has led to low labour participation rates in the economy and brain drain, as workers have less incentive find employment inside the country. In fact wages have been suppressed at such low levels that local workers were displaced by low-waged foreign workers.


We have no doubt that the social economic data supports the increase to RM1500. As such we are very disturbed that the Government intend to allow small and micro companies to postpone the implementation of the minimum wage.


Such a proposal will be discriminatory and maybe even non in compliance with the NWCC ACT. 


Cost of living for workers is the same no matter which employer they work for. A cup of coffee, a pack of nasi lemak, a bowl of mee or a litre of petrol cost the same whether one is an employee of a GLC, a multinational big company or a small business.  They are all from the same keluarga Malaysia.







In fact most big companies provide other employment perks that SME do not provide. So workers of small business are already worse off.


It is also a fallacy and fear mongering to claim that small business cannot accord to pay. They have fewer workers and their labour cost is not higher than big companies. SMEs are a pampered lot and they even have a dedicated ministry and many government agencies to look after their interest.


It will also be an implementation disaster as many employers are spilt into separate legal entities and associate companies and hence qualify as small business when in reality they are significant employers. It will lead to abuses.


We therefore demand that the new MW must apply to every employee throughout the nation.






ANDREW LO

SECRETARY

MTUC SARAWAK