‘Minimum wage increase will up cost of operations’
KUCHING: Any move to increase the minimum wage of employees will increase the costs of business operations as a whole, thereby giving negative impact on the competitiveness of the business concerned.
Sarawak Business Federation ( SBF) secretary- general Jonathan Chai offered his opinion yesterday when prompted to respond to the recent indication of the Ministry of Human Resources to standardise the minimum monthly wage across the country within the next five years.
He said the federation had not deliberated on the issue but he was speaking from the perspective of employers.
“In any event, the current rate, which was recommended by the National Wages Consultative Council ( NWCC), has taken into account the median amount of wages that employers can afford to pay their employees, and also the difference in the cost of living between East and Peninsular Malaysia,” he said.
He said the minimum salary data from the Department of Statistics indicated that the ability of employers in Sarawak and Sabah to pay higher salary ‘is lesser compared to Peninsula’.
The statistics also indirectly indicated that higher minimum rate would affect the employability of the local job seekers, he added.
“While we hope to provide better welfare for employees of the state by standardising the rate, we also need to take into account the interests and survival of employers to achieve a win-win situation,” said Chai, who is also secretary- general of Kuching Chinese General Chamber of Commerce and Industry ( KCGCCI).
Minister of Human Resources Datuk Seri Richard Riot recently said standardising the minimum monthly wage across the country was a way to mitigate the increasing cost of living and reduce the disparity in minimum wage in Malaysia.
He also expressed his concern over the ability of employers in Sarawak, Sabah and Labuan to offer higher salaries to their employees.
On Wednesday, the chairman of Malaysian Trade Union Congress ( MTUC) Sarawak, Mohamad Ibrahim Hamid, said there was no reason not to standardise the minimum monthly wage across the country ‘considering the cost of living in Sarawak is getting higher’.
He said MTUC fully supported the recommendation for standardising the minimum wage within the next five years.
He even said the standardisation should have been enforced when the Minimum Wage Act was first implemented.
At present, the minimum monthly wage in Peninsular Malaysia is RM1,000 compared to RM920 in Sarawak and Sabah.