ACCCIM says minimum wage policy needs to match the different capabilities of SMEs

Source From (The Star Online): http://biz.thestar.com.my/news/story.asp?file=/2012/3/16/business/10925918&sec=business

Published: on 16 March 2012
By LIZ LEE
lizlee@thestar.com.my

KUALA LUMPUR: The Associated Chinese Chambers of Commerce & Industry of Malaysia (ACCCIM) is of the view that the proposed minimum wage policy needs more detailed classification to match the different capabilities of SMEs.

Speaking to the media at the third ACCCIM SME conference, deputy treasurer C.S. Tangrecommended that the focus be shifted to the total take-home income of workers, rather than a one-size-fits-all salary
figure.

Koong says the proposed policy will be tough on companies with low-skilled workers.

 

“There should be classes (for different companies). Those that depend on salary without incentives, they should follow one set of criteria; those with minimum salary plus incentives should meet other criteria.

Otherwise when you mix them up, it would be a problem for the people carrying the cost,” he said, adding that manufacturers especially might be pushed out of the market if they had to bear higher costs.

He also said that the policy should take into account the varying living cost in the country's regions and operational costs in different industries.

In ACCCIM's fifth SME market survey, it found that 47% of the respondents opposed the blanket minimum wage policy. Of this, 40% are manufacturers.

National council member and head of SME survey unit Koong Lin Loong said the survey found those supporting the policy were young SMEs which had only been around for less than three years.

Those that depend on salary without incentives, they should follow one set of criteria; those with minimum salary plus incentives should meet other criteria. - C.S. TANG

 

“Maybe because they have fewer workers and lower operational cost, the policy has less impact on them,” he said.

He added that the proposed policy would be tough on companies with low-skilled workers but not a problem for those employing professionals as the salary scale in the latter already exceeded the proposed minimum wage.

“Those who employ low-skilled workers, they oppose, but the professionals and skilled workers are above (the RM800 mark) so they have nothing to oppose,” he said.

In the survey, the chamber of commerce found that 62% of the SME respondents were facing human capital shortage with the problem most pronounced in the hotel industry, agriculture, farming, timber, fishery and gardening industry and manufacturing.

On the ratio of workers' nationality, 43% of them hired foreign staff, mostly in the agriculture, timber, fishery, farming and gardening as well as construction sector.

Industries with the least foreign workers were travel and entertainment, professional services and ICT.
The survey also found that 68% of the SMEs agreed with the Government's move to extend the retirement age to 60.