Are workers being left behind in the New Malaysia?

Malaysian workers, like most other sectors of society, had reason to cheer and be hopeful when Pakatan Harapan (PH) overcame the odds to overthrow the Barisan Nasional (BN) regime in the May 9 general election.

The BN government under the leadership of Najib Razak had descended into a moral abyss, and was even described as a kleptocracy by the international community. As with any type of failure in governance, the lower income group and those at the bottom of the wealth and income pyramid paid the biggest price. Workers in Malaysia were afflicted with a deadly mix of a higher cost of living, depressed wage levels, precarious employment practices and increasingly curtailed labour and trade union rights.

When PH succeeded in the general election, it was due largely to the sentiments of the disenfranchised wage earners. It was the common people that drove PH to victory. The secretary-general of the Malaysian Trades Union Congress (MTUC) had urged Malaysian workers to support PH, though it must also noted that the president of MTUC very quickly issued a rebuttal and aligned himself and those who agreed with him with the incumbent BN government. Nevertheless, the results showed that the workers of the country were firmly behind the idea of a change in government and made it a reality.

It is reasonable for the Malaysian workers to expect a change in their fortunes after decades of being trampled on through poor social and economic policies, with institutionalised corruption leading to an imbalance that favoured businesses, in particular poor and unethical business practices.

While there are many issues involving labour and employment that need to be resolved by the PH government, at the heart of it is the need to ensure that every worker enjoys a decent standard of living.

The PH government clearly misfired when it increased the minimum wage to a paltry RM1,050 per month, from its previous rates of RM1,000 in Peninsular Malaysia and RM920.00 in East Malaysia. There was palpable disappointment among workers, and the government soon realised it. During the budget proposal for 2019, the minimum wage was increased to RM1,100 with effect from the beginning of 2019. Though it is heartening to note that the government is listening to the people, it still falls short of the living wage.

The living wage is the minimum threshold for a worker to meaningfully participate in society, and to meet basic needs. A recent Bank Negara Report put the living wage at RM2,700 per month for a single person living in Kuala Lumpur. The difference between the minimum wage of RM1,100 and the living wage, which will differ from city to city, represents the failure of the economic policies of the country. We say failure because the minimum wage is far behind the living wage threshold.

Businesses in the first instance extolled the move to increase the minimum wage to RM1,050, and then expressed their dissatisfaction citing reasons such as investor confidence when it was increased again to RM1,100.

Irresponsible employers have for the longest time been the mouthpiece for inefficiency, exploitative employment and poor business practices. Where any business cannot survive by paying its workers a living wage, it points towards a failed business model in the broadest sense. Where workers have to be paid a wage below the living wage threshold for a business to make profits, such profits are being subsidised by the workers.

Any country is placed at a certain place in the global supply chain continuum. Investors should be attracted to the proposition of doing business in Malaysia based on our real competitive advantage, not an artificial one set through the enslavement of our workers.

The PH government has been dealt with a tricky hand, and has inherited a government that has problems on so many fronts due to the mismanagement over the course of many years by the BN government. Also, there is the matter of the changing dynamics of the world order, which the country needs to adapt to.

It would be wrong to expect the PH government to make good the misdeeds of the past in such a short time. What is needed though within the employment and landscape is a roadmap that would take both workers and businesses to a place where both parties can thrive in a win-win climate. The government should get cracking on devising a system where workers in the country would see themselves as an equal partner in the employment equation.

Syed Shahir Syed Mohamud and Callistus Antony D’Angelus are FMT readers.

The views expressed are those of the authors and do not necessarily reflect those of FMT.