Kong: Raise minimum wage to RM1,500 gradually to give SMEs time to prepare

Michael Kong

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KUCHING, March 23: The RM1,500 minimum wage which comes into effect on May 1 does not help solve issues, but instead creates room for more problems, opines Democratic Action Party Socialist Youth (Dapsy) Kuching chief Michael Kong.

In a statement today, he said the minimum wage should be raised gradually year by year and not through a sudden 25 per cent hike as although the minimum wage does not apply to small and medium enterprises, it would indirectly cause disruption in the industry.

“For example, coffee shops which have less than five employees may not need to match the RM1,500 (minimum) salary. However, there will be numerous coffee shops out there offering a minimum salary of RM1,500.

“With a difference of RM300 per month, many of these workers would be tempted to leave the smaller shops and this will result in many small businesses losing out due to a shortage of manpower.

“Faced with this possibility, these smaller coffee shops would have no choice but also opt to pay the minimum salary of RM1,500 despite it not being mandatory,” he explained.

Kong said if the minimum wage were to be increased slowly, it would ensure the impact is cushioned and that the trickle-down effect on the economy and inflation is lessened.

This will allow companies to properly plan and manage their operations instead of being caught in a difficult position of retrenching staff, he added.

Meanwhile, Kong called upon the government to also look into raising the minimum salary for youths.

“We believe that youths who receive training or mentorship ought to also be adequately remunerated. The youths of today are not merely learning from their seniors but are also producing or bringing income for the firm they are working at.

“As such, it is only right that they are remunerated accordingly and not be taken advantage of,” he said. — DayakDaily