KOTA KINABALU May 15, 2012: The Federation of Sabah Manufacturers (FSM) is calling for more details from the Malaysian Trades Union Congress (MTUC) Sabah about the minimum wage issue.
Its president, Datuk Seri Panglima Wong Khen Thau, said that FSM feels that certain points raised by MTUC Sabah secretary Catherine Jikunan recently were short on proper verification and understanding.
Wong hoped that clarifications are given to be fair to all the Sabah trade chambers that have joined the stand on minimum wage.
“Actually, our request, the Sabah trade chambers, including FSM, is not to delay implementation, but instead to allow gradual implementation over three years. An annual 15 per cent raise based on current Sabah’s average minimum wage is proposed from year one, which will bring the state’s wage level to be on par with Peninsular Malaysia on the third year,” explained Wong.
He said this will in fact benefit employees sooner, as compared to the proposed grace period of between six months to a year to apply after it is gazetted.
“Such gradual implementation will enable small businesses to cope, with ultimately a win-win balance of employees having decent living standard whilst employers operate sustainably.
“It will also prevent, if not minimise the drastic increase in cost of goods and services – to the extent of ‘cost of living to increase threefold in three years’ time”, as opined by MTUC Sabah.
“Such hyper-inflation scenario, if supported by facts would be dire for all parties concerned. Despite sitting as representative for MTUC Sabah in the National Wage Consultative Council (NWCC), she (Jikunan) does not seem to realise that Sabah trade chambers’ voices have been compromised, if not being deliberately kept out of the loop,” he said.
He added that the Sabah Employer Consultative Association (SECA), supposedly representing Sabah employers’ voice in NWCC, is not nominated by any of the major Sabah trade chambers to sit in the council. No nomination was ever solicited from Sabah trade chambers prior to setting up of NWCC.
Sabah’s trade chambers only knew of SECA’s appointment in NWCC to represent Sabah employers after the details were published in the newspapers in September last year.
The trade trade chambers in Sabah have since attempted on several occasions to get in touch with SECA, but regrettably to no avail.
“For the record, SECA did not once initiate any meeting with Sabah trade chambers to gather feedback or comments, and the only time when their representative met with trade chambers here was on December 28 last year to attend a dialogue organised by FSM, and even then no information was forthcoming as to the status and progress of Minimum Wage deliberations in NWCC.
“This does not reflect effective representation by any measure, and the apparent fact that SECA’s chairman is by profession an employee. FSM trust that MTUC Sabah would wish for Sabah trade chambers, as employers in Sabah, to have a real part to play in the council’s deliberations, in keeping with the tripartite nature,” he said.
As it stands, employer representation in NWCC predominantly rests with Malaysian Employers Federation (MEF), itself without having any branch office in Sabah.
Sabah trade chambers are not confident, and MTUC Sabah should agree that this would affect what MEF can bring to the table considerations based on Sabah’s situations and henceforth achieve outcome that is equitable.
Without an ear or eye in NWCC, Sabah trade chambers have indeed been kept in the dark, and have to accept the minimum wage rate of RM800 as it is.
“It should be noted that despite all limitations, Sabah trade chambers have been proactive in addressing the issue of minimum wage; first with an education forum on minimum wage on November 29, 2011, which was supported and attended by Sabah state government’s representative, except for SECA, and later by organising a luncheon dialogue with Deputy Minister of Human Resources, Senator Datuk Maznah Mazlan on January 19 this year.
Wong said the objective had always been to responsibly propose a workable format of implementation for Sabah’s situation, in adherence with the minimum wage principle.
This is to ensure a win-win outcome without spiral upwards in costs of living and eroding the living standards.
He said that evidence to this is the submission of a proposal to Maznah outlining a minimum wage level, with a view to gradually adjusting upwards.
Wong stressed that the Sabah trade chambers would like to know the logical basis of MTUC Sabah’s demand for RM1,200 minimum wage level.
“Is this over 100 per cent increase from the current average Sabah’s wage of RM577 to make up for the ‘low wage since independence’ as mentioned by MTUC?
“Provision of statistics supporting this claim would be good for employers to conduct some soul-searching. Perhaps MTUC Sabah can do some soul-searching of its own for only voicing it after such a long time,” said Wong.
He said that the businesses in the state are finding it difficult to enjoy healthy margin in a challenging market as in Sabah.
Faced with a drastic increase in wage cost, it is likely that the cost increase will be passed on to consumers, which will inevitably negate the minimum wage’s effect.
“FSM would in fact like to know why MTUC Sabah did not eventuate the outcome of RM1,200 minimum wage level in NWCC as demanded. Despite Sabah trade chambers’ reservations on the economic viability, and severe cost pushed inflation result at that level, MTUC Sabah’s stand would have been considered, and if so, perhaps it is pertinent that NWCC’s deliberation process be revealed, made public as to why ‘only’ RM800 quantum is set? What with numerous studies by experts from different fields, technical meetings, reputable world bank’s research, and tripartite contributions from all stakeholders; all of these currently being kept away from public scrutiny.
“Wage deliberation process should be transparent, and inclusive. Just as with MTUC Sabah knowing close-at-heart Sabah employees’ living needs, Sabah trade chambers would have first-hand knowledge of the difficulties of running businesses in Sabah.
“No doubt both sides will face challenges; with high living costs, low living standards, and high costs of doing business,” he said.
Wong pointed out that the responsible thing to do now would be for both MTUC Sabah and Sabah trade chambers to sit down, share each other’s viewpoints, work together; and come out with a solution applicable to Sabah’s circumstances for the long-term future of making Sabah better.