PETALING JAYA: A more comprehensive review of labour policies is needed to benefit all parties, say two researchers.
They were referring to the recent enforcement of a policy in the amended Employment Act that reduces employees’ work hours from 48 to 45 hours a week.
Ibrahim Suffian of Merdeka Center said policies such as reduced hours tend to be viewed as one-sided by employers, particularly in small and medium enterprises (SMEs).
“This is understandable because of the need to sustain businesses. Most are unable to tool up or invest in new technologies that boost output at a time when things are still economically challenging,” he told FMT.
Ibrahim said “piecemeal action” penalises small businesses which are not able to employ foreign labour or do not have the capital to move towards a higher value service or production that can help boost revenue.
“The government has to play a proactive role and update its procurement policies to consider higher wages and benefits to workers,” he said. “There needs to be a more comprehensive review of labour policies.”
FMT previously reported that employers were unhappy with the work hours policy, saying it was detrimental to productivity, while workers welcomed the reduction.
Lee Hwok Aun, a senior fellow at Singapore’s ISEAS-Yusof Ishak Institute, said Malaysia needs “clarity, commitment and sustained effort” moving forward as far as policymaking is concerned.
“Reducing full-time work hours is in line with the country’s long-term goals of being a high-productivity, high-skill and high-income country. The international standard is 40 hours per week, so there is still more progress to make,” he said.
Lee said the country is behind the curve, with labour laws and institutions still catching up with international norms and practices of upper middle-income countries.
He also pointed out that Malaysia was late to introduce a minimum wage, later than Indonesia and Cambodia, whose national incomes are lower.
“There were complaints from employers when it was introduced, but it eventually got through that transition and it has become widely accepted as a legitimate and necessary intervention to move the country forward,” he said.