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KUCHING, Feb 9: Sarawak Oil Palm Plantation Owners Association (SOPPOA) has joined various industry players to object to the implementation of the minimum wage hike to RM1,500 per month by the end of this year.
SOPPOA chief executive officer (CEO) Dr Felix Moh Mee Ho said the Human Resource Minister Datuk Seri Saravanan Murugan should be mindful that the last raise on minimum wage was in February 2020 from RM1,000 to RM1,200 per month.
“The cost of doing business has increased dramatically recently due to disruption of the supply chain and high raw materials costs.
“For example, the price of fertilisers and chemicals used in oil palm plantations has doubled compared to last year.
“As such, an additional increase of 25 per cent of wages is akin to extra overhead which is irreversible when the price of the commodity comes down,” he pointed out in a statement today.
Saravanan had on Feb 5 announced that a new minimum wage of “around RM1,500 a month” is expected to be implemented before the end of this year. He said the new rate had yet to be finalised, as the Ministry was awaiting Cabinet approval. In February 2020, Malaysia’s minimum wage was raised to the current RM1,200 per month from RM1,100 per month previously.
Furthermore, Moh emphasised the fact remains that the cost of doing business in Sarawak is about 20 to 30 per cent higher than Peninsula Malaysia due to logistic issues.
“If the planned increased minimum wage is implemented uniformly across the country, it will be more detrimental to the business community here,” he added.
While SOPPOA is not against higher wages, Moh however viewed that the earning of additional wages should be linked to productivity.
“Oil palm plantation, for example, practices a ‘piece rate system’ whereby worker’s pay is not based on how many hours they worked, but rather on numbers of tasks they completed.
“This ‘piece rate system’ is proven not only to improve labour productivity but also higher earnings,” he explained.
Moh said the Human Resource Ministry should have a more holistic strategy in tackling wage issues instead of resorting to adjusting minimum wages every now and then because any disruption in business operations would have adverse effects on the economy, especially in this uncertain situation.
Meanwhile, a delegation from SOPPOA led by its chairman Eric Kiu Kwong Seng paid a courtesy visit to Chief Minister Datuk Patinggi Tan Sri Abang Johari Tun Openg yesterday (Feb 8).
In the meeting, SOPPOA took the opportunity to share with Abang Johari some of the challenges faced by the Sarawak oil palm industry including acute labour shortage.
Deputy Chief Minister Datuk Amar Douglas Uggah Embas, State Secretary Datuk Amar Jaul Samion, Assistant Minister for Labour, Immigration and Project Monitoring Datuk Gerawat Gala and Sarawak Immigration director Datuk Ken Leben were among those present. — DayakDaily