KOTA KINABALU September 14, 2012: Hotels in Sabah will be adversely affected when the mandatory minimum wage policy takes effect from January 1, 2013.
Even now many hotels in Sabah were already lamenting the huge increase in wages they had to pay to their staff, Sabah Hotel Association (SHA) president Christopher Chan said this to reporters after chairing the SHA’s annual general meeting near here yesterday.
“When the policy takes effect, big hotels with hundreds of staff will experience 60 percent increase in cost to pay the basic salary of their staff.
They will also experience 15 percent hike in the payment of EPF (Employee Provident Fund) and Socso for their staff. So that is a huge increase,” he said.
“I may have to increase my room rate. Or I may reduce my cost, which means I may need to retrench some workers. These are the main issues when it comes to the policy revolving around the minimum wage,” he said on the effects of the minimum wage policy on hotels.
Chan also said the biggest implication would be faced by the unskilled workers.
“I don’t mind paying RM800 to a skilled worker, but what if I have to fork out RM800 for an unskilled worker and still have to spend more on their training. I would say, no way. So what is going to happen to the unskilled workers? This may lead to the incidence of more social ills within the community,” he said.
He added that Sabah and Sarawak were still developing the industry and could be compared with their peers in Peninsular Malaysia who were paying their staff more than the stipulated amount set under the policy.
“Only a few industries, namely the agriculture and fisheries sectors, (in Peninsular Malaysia) are paying less. So they will not be affected,” he said.
Chan also said the hotel and service industry in Sabah and Sarawak employ staff with even Primary Six qualifications and these people would feel the pinch most.
“And there are also cases of IMM13 holders working at restaurants and coffee shops. This problem is endemic to Sabah. How are we to address that? There are some 80,000 IMM13 holders residing and working in the service sector,” he said.
Chan added that they were also unclear about the guideline in the new policy.
“We don’t know the facts as of now … but there must be a review period.”
He said that they would be meeting with the State Labour Department on September 21 on the policy.
Most hotels in Sarawak have applied to defer the implementation of the Minimum Wage Policy as they were concerned about their ability to sustain business in view of the increase in floor wage.
by Jenne Lajiun