SMEs seek delay on minimum wage hike

This is as most firms may not be able to withstand the rapid increase of RM300


SMALL and medium enterprises (SMEs) may not be able to withstand the rapid increase of minimum wage from RM1,200 to RM1,500.

The Japanese Chamber of Trade & Industry Malaysia (JACTIM) president Daiji Kojima said the RM300 rise is too steep and should be done in stages.

“We, JACTIM, agree on the direction of raising the minimum wage, which is the government policy, but we would like the government to consider the implementation in stages according to economic indicators.”

“As the Malaysian economy is standing at the door of recovering from a pandemic, many companies, especially SMEs, cannot withstand the rapid increase of RM300 in the minimum wage,” he said in a statement yesterday.

Read more: RM1,500 minimum wage from May 1, GE15 to be discussed: PM

Recently, Prime Minister (PM) Datuk Seri Ismail Sabri Yaakob announced the government’s decision to raise the minimum wage to RM1,500.

Several industry players have called for the hike to be done gradually, as the nation is still recovering from the economic onslaught brought by Covid-19.

MCA spokesperson Saw Yee Fung said SMEs should be subjected to the new wage hike within the next five years.

“With the nation’s economic recovery as our current priority, it would be ironic if the minimum wage policy results in SMEs closing down due to inability to afford workers. Hence, I urge the government to grant SMEs some leniency by postponing implementation for them to a specific date in the next three to five years.

Read more: FMM asks govt to reconsider minimum wage implementation

“I am confident that the extra time will allow businesses to plan better as well as gain a firmer foothold in this recovering economy,” he said in a statement yesterday.

Meanwhile, the Malay Economic Action Council (MTEM) said while it supports the PM’s announcement, it has not been able to address the issue of living wage as a whole.

“MTEM is preparing a policy paper to be presented to the government towards creating a win-win solution for employers and employees. The concept of ‘fair living wage’ or living wage is core to proposals to be raised to help the government realise the 12th Malaysia Plan and the Shared Prosperity Vision by 2030,” MTEM representative Azlan Awang said.

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