SOPPOA: Private palm oil companies in Sarawak not ready for minimum wage hike, only two GLCs give nod

Sarawak Oil Palm Plantation Owners Association (SOPPOA) logo.

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KUCHING, April 17: Only two palm oil government-linked companies (GLCs) in Sarawak have agreed to implement the RM1,500 minimum wage, while private companies are not ready for the minimum wage hike.

The Sarawak Oil Palm Plantation Owners Association (SOPPOA), when stating this, took a firm stance that their members cannot afford to increase the workers’ minimum wage by 36 per cent without a phased implementation.

SOPPOA chief executive officer (CEO) Dr Felix Moh Mee Ho said despite the high palm oil price at the moment, there are other input costs for fertilisers, chemicals, and plantation operation costs that are burdening as well.

“In a worst-case scenario, at the present high cost of production, oil palm plantations in Sarawak may struggle to maintain a positive balance sheet if there is a drastic drop of palm oil price to below RM4,000 per ton,” he said in a statement today.

Though appreciating the government’s effort to help the business sectors solve the labour crunch, Moh urged Human Resources Minister Datuk Seri M. Saravanan to heed the private sector’s views.

He said GLCs, having been backed by the government, presumably are more resistant to economic shock, including the negative impact on finances from the sudden rise of minimum wage.

“Therefore, it makes good business sense for GLCs to undertake a feasibility study to gather more convincing data on the RM1,500 minimum wage before it is gradually implemented in private sectors,” he added. — DayakDaily