Bridge economic gap first before bridging minimum wage gap

KOTA KINABALU: The Sabah Employees Association (SEA) has urged the Human Resource Ministry to bridge the economic gap before bridging the minimum wage gap.

This is its official response to the latest news that the ministry will announce the 2018 minimum wage review and bridge income gap.

SEA believes that before the ministry begins with review, there are two critical shortcomings to be ratified beforehand.

Firstly, to ensure that there is a real private sector representation in the National Wages Consultative Council (MGPN). This blatant omission has still not been addressed despite several years of protests from majority of Sabah chambers and associations.

SEA pointed out that the inclusion of State Secretary office’s representative into MGPN is a complimentary albeit delayed move; culminating in now having both union and governmental representatives for Sabah. The final piece in the puzzle now is to appoint Sabah’s private sector representative in the council, in the true spirit of tripartitediscussion for the state.

This is important to ensure that the collected views of almost 39,800 employers in the state be heard and taken into consideration, the association said in a statement yesterday.

Secondly, before bridging the so-called minimum wages gap between Sabah, Sarawak and Peninsular Malaysia, SEA said the fundamental economic discrepancies must first be solved.

According to SEA, Sabah poses tremendous challenges for businesses. Up to 70% of Sabah’s employers run business classified as either micro or small enterprises, with key concern of simply staying afloat.

The latest release of Sabah’s 2016 economic figures showed only pocketed growth in certain sectors. Three major sectors have seen sharp decrease in activities — agriculture, construction and manufacturing.

Taking out major growth contributor of Oil & Gas (which is the smallest employer by size; hiring only 7,500 employees in the state) would show the state’s economy to be in worse shape than appears.

To date Sabah’s GDP Per capita is the third lowest in the country.

Yet in spite of all these, Sabah’s employers have steadfastly held on to their responsibilities: providing 12.7% wage growth to employees in 2016 (third highest in the country), while retrenching on average only 254 employees per year.

Private sector cannot afford to support the economy alone. SEA urges emphasis on improving the air/sea/road connectivity of Sabah with its external trading partners, infrastructural developments be expedited, all within almost immediate timeframe.

SEA stressed that bridging minimum wage gap should be in line with bridging macro-economic developmental gaps between East and West Malaysia. Only when Sabah grows inclusively with the country can the economic pie be sustainably enjoyed by all.

“It is incorrect to push for one rate one country, when situations are different everywhere.

“The focus should be to bridge the economic gap first, before bridging the minimum wage gap,” it added.