The government should put in place appropriate mechanisms to support employers to bear the additional cost increases should maternity leave be extended from the current 60 days to 90 days, as was proposed by the Prime Minister in the Budget 2018.
Currently, employers in Malaysia pay full wages for the 60 days maternity leave for up to five surviving children, where the cost of maternity leave is about RM1.495 billion per year. The Malaysian Employers Federation (MEF) said should maternity leave be increased to 90 days, the additional costs to employers is estimated to increase by about RM747 million per year. Employers need to also pay for the cost of replacement that would also amount to about RM747 million, thus amounting to a total of about RM1.5 billion per year.
In comparison with other countries such as Singapore, Thailand, the Philippines, Korea, Australia, France, Sweden, and Norway the wages during maternity leave is paid wholly or partly by the government or social security or insurance. In the United States, the maternity leave period is unpaid. MEF Executive Director, Datuk Hj. Shamsuddin Bardan said, “Compared to other countries, employers in Malaysia are already very generous as they pay the wages in full for the 60 days maternity leave.” “Whilst MEF supports women in employment, to require employers to bear the additional costs of 30 day maternity leave would be grossly unfair in view of the very challenging economic environment and implementation of other new policies, such as the Employment Insurance Scheme (EIS), expansion of SOCSO coverage and minimum wages.”
“The government should share the costs with the employers. Employers are already stretched in that the number of working days for an employee in Malaysia is already quite low and one day’s wages in the private sector is estimated at RM600 million. An average of 250,000 women employees go on maternity leave each year.”