PETALING JAYA: The Federation of Malaysian Manufacturers (FMM) and the Malaysian Rubber Glove Manufacturers Association (Margma) has accepted the increase in minimum wage in their stride.
After a Cabinet meeting, the Prime Minister's Office announced in a statement that the government will raise and standardise the minimum wage rate at RM1,050 per month, or RM5.05 per hour, effective 1st January 2019.
The new minimum wage is RM50 more than the current rate of RM1,000 per month in Peninsular Malaysia, and a RM130 hike from the existing rate of RM920 per month in Sabah, Sarawak and Labuan.
When contacted Margma president Denis Low said "our members take this increment in a stride. We hope our clients will accept and understand the Malaysian government is striving for balance of interests of all stakeholders in the supply chain."
"Margma lauds the Prime Minister's Office for allowing lead time for our members to do the necessary adjustments to our costings and glove pricing," Low added.
In a statement yesterday, FMM expressed hope that the government would step in to help mitigate this 14 per cent basic wage increment in Sabah and Sarawak.
The Prime Minister's Office had recently said that the minimum wage would be increased by RM50 for Peninsular Malaysia and RM130 for Sabah and Sarawak, in an effort to standardise salaries across the country, from January 2019.
Following recommendations from the National Wage Consultative Council, minimum wage would be set at at RM1,050 a month effective 1st January 2019.
In its election manifesto, political coalition Pakatan Harapan said it would raise the minimum wage if it came to power, and would bear 50 per cent of the increased cost of employers, after the wage is raised.
In the same statement, the Prime Minister's Office said despite an earlier promise in Pakatan Harapan's election manifesto, it would not be able to subsidise employers due to the current financial constraints.
In calling the increase painful for Sabah and Sarawak manufacturers but still tolerable, FMM said the four-month lead time before implementation allows for the industry adequate lead time for budgetary adjustments.
There will be knock-on effects, of which basic salaries of staff that are at and near the minimum wage level are adjusted to maintain wage differentials between grades and seniority.
"However, we expect adjustments this time around to be less extensive in Peninsular Malaysia," FMM added.
FMM added it hopes the government will continue to consult closely with the industry in deploying its phased increase approach.
"Early consultation will reinforce goodwill as well as give greater certainty and clarity on the mechanism to help businesses in planning their operations and strategies," it said.
FMM represents more than 10,000 business owners throughout the country's manufacturing supply chain, including that of medical glovemakers.
