KUCHING: Sarawak Oil Palm Plantation Owners Association (SOPPOA) has joined the growing chorus of opposition to the federal government’s proposal to raise the minimum wage to RM1,500 a month.
In making its stance known, it felt the federal Human Resource Ministry should have a more holistic strategy in tackling the wage issue instead of resorting to adjusting minimum wages every now and then.
“This is because any disruption in business operations would have adverse effects on the economy especially in this uncertain situation,” said SOPPOA chief executive officer Dr. Felix Moh Mee Ho in a statement on Wednesday (Feb 9).
Illustrating, he pointed to the cost of doing business having increased dramatically recently due to a disruption of the supply chain and high raw material costs.
“For example, the price of fertilisers and chemicals used in the oil palm plantation has doubled compared to last year.
“An additional increase of 25 per cent of wages is akin to an extra overhead which is irreversible when the price of the commodity comes down.”
He added that the cost of doing business in Sarawak was about 20 to 30 per cent higher than West Malaysia due to logistical issues.
In this respect he said if a minimum wage hike were to be implemented uniformly across the country, it would be more detrimental to the business community in the state.
“SOPPOA is not against higher wages but opines that the earning of additional wages should be linked to productivity.
“Oil palm plantations, for example, practice the ‘piece rate system’ whereby worker pay is not based on how many hours they work, but rather on number of tasks they completed.
“This system is proven as it not only improves labour productivity but also higher earnings,” he said.
