The Malaysian Employers Federation has called on the government to revise its stimulus package to provide more help to employers badly affected by the Covid-19 pandemic. Its executive director Datuk Shamsudin Bardan said the RM600 monthly aid each for worker was not enough to help employers keep all their workers. “The total amount allocated by the Government only accounts for 7% of the total RM27.5bil in monthly salaries paid to workers in the private sector. “The government needs to inject a 70% subsidy, not a mere 7% if it wants employers to avoid retrenching workers. “We need to opt for pay cuts to avoid retrenching workers, but if the government insists we pay full salaries, then they should seriously look into providing better incentives. “Furthermore, under existing rules and regulations, many employers are not eligible to apply for the RM600 aid for each worker. “We hope the Government will look into it when drawing a stimulus package,” he said.
He said the RM5.9bil announced in the Prihatin Rakyat Economic Stimulus package for the Wage Subsidy Programme of RM600 a month for three months for employers with a 50% drop in business since 1 January and for workers with a salary of below RM4,000, was not attractive. “That RM5.9bil, you divide it by three months, it is about RM1.97bil but the wages for the formal private sector is RM27.5bil per month, covering 7.6 million workers. “That’s barely 7%. When you compare to other countries like the United Kingdom giving 80% wage subsidy, Canada and France giving 75%, Singapore at 30%, we wonder if the government is going to come up with strategies to help employers, ” he said, suggesting that the wage subsidy programme should be increased to 70%.
Some might feel that employers wanted to maximise profit but at this moment, businesses were more concerned about their survival, said Datuk Shamsuddin. He said there were also some conditions under the wage subsidy programme which were limiting, causing more confusion. “All stops need to be pulled out to assist the private sector employers. If the government’s assistance is not attractive enough, then the forecast by the Malaysian Institute of Economic Research of 2.4 million retrenchment could happen and that would be disastrous, ” said Shamsuddin.