PETALING JAYA: Business groups have objected to a proposal that the government be asked to mandate a one-month bonus as festival aid for workers, warning that such a move would place a significant financial burden on employers.
Malaysian Employers Federation president Syed Hussain Syed Husman said the move would cause a huge burden for businesses still recovering from the Covid-19 pandemic.
“Businesses today are merely surviving,” he told FMT.
“Micro, small and medium-sized enterprises account for 95% of all businesses (in Malaysia), and they need time to rebuild their cash flow and resources.
“People who make these suggestions must understand that businesses are not banks.”
Syed Hussain also said it was important for businesses to adhere to planned schedules for their financial and operational stability.
On Monday, the Social Protection Contributors Advisory Association Malaysia (SPCAAM) urged the government to make it mandatory for all employers to offer at least one month’s salary as festival aid.
SPCAAM president J Solomon cited EPF’s Belanjawanku 2022/2023 expenditure guide for Malaysians which found that Klang Valley residents spend over a month’s pay on yearly social and festive activities.
He said Indonesia had set a “remarkable precedent”, mandating a month’s salary as festival aid for all employees.
Small and Medium Enterprises Association of Malaysia president William Ng said the proposal, if accepted, would put a financial strain on businesses, especially as they had seen reduced profit margins since the pandemic.
“Most businesses are operating with margins lower than before the pandemic,” he said.
“As such, wages, being the main cost component, have to be budgeted carefully against business performance.
“If we are to entertain this suggestion, it will impact real salary growth for deserving Malaysians.” - FMT
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