Close shop if you can’t afford minimum wage, employers told

PSM's Jeyakumar says MEF is making an empty threat in a last-ditch effort to keep costs down.

PETALING JAYA: Parti Socialis Malaysia (PSM) Central Committee member Michael Jeyakumar has ticked off employers who oppose the enforcement of the Minimum Wage Order 2016 (MWO 2016), telling them to close shop if they can’t afford to keep their workers.

Reacting to a statement by Malaysian Employers Federation (MEF) executive director Shamsuddin Bardan, Jeyakumar said he found it ludicrous for any corporation to say that it couldn’t pay the minimum wages specified in the order – RM1,000 in Peninsular Malaysia and RM920 in Sabah, Sarawak and Labuan.

Human Resources Minister Richard Riot announced on Monday that MWO 2016 would come into effect this July 1. Responding to the announcement, Shamsudin said the enforcement might result in the retrenchment of 30,000 workers, especially at the lower levels.

Speaking to FMT, Jeyakumar acknowledged that Malaysian companies might lose their competitiveness with counterparts in low-wage Asean countries like Vietnam and Thailand, but only if the minimum wages specified in MWO 2016 were too high.

“Raising the minimum wage to, let’s say RM2,000, would be a little too high, but if they can’t even afford RM1,000 and if they need to have sweatshop conditions and maintain a significant proportion of people in poverty, then they should just close shop,” he said.

He said he suspected that the MEF statement was merely an empty threat made in a last-ditch effort to keep costs down.

The Secretary-General of the Malaysian Trades Union Congress, N Gopal Kishnam, agreed with Jeyakumar. He said MEF was probably trying to pressure the government to delay the enforcement of MWO 2016.

“They’re just trying to threaten the government into not implementing the new minimum wage,” he said. “They are only concerned with their own profit margins.”

Klang MP Charles Santiago said corporations had been given ample time to prepare for MWO 2016.

“They can’t say that they are not prepared for MWO 2016,” he said. “It’s been delayed for so many months. There’s no reason they can give for retrenchment apart from the fact that what they really want to do is to maximise their profits.”

PKR Vice-President Tian Chua said his party would be asking federal lawmakers to review the difference in the minimum wages between the Peninsular and East Malaysia.

“The concept of minimum wage is that the basic livelihood for individuals is covered and that is a form of safety net,” he said. “It should not be less for East Malaysians.”