MEF shocked by Rafizi's progressive wage increase plans

SHAH ALAM - The Malaysian Employers Federation (MEF) has expressed shock at Economy Minister Rafizi Ramli's plans for a progressive wage increase in the private sector.

In a statement, MEF President Datuk Syed Hussain Syed Husman said that wage-related policies fall under the jurisdiction of the Ministry of Human Resources, not the Ministry of Economy.

"The Economy Minister should be sharing with businesses and the rakyat on plans to improve the economy thereby raising the standard of living of the Nation and its citizens.

"So far, MEF has yet to see any concrete plans from the Minister of Economy that are focused and formalised that would be able to improve the country's economy, thereby raising the standard of living of the Nation and its citizens," he said.

On Tuesday, it was reported that Rafizi described wage model as one of the most "unpopular" reforms he would implement as a policymaker.

He further warned that a policy that may compel employers to raise pay periodically could face backlash.

Commenting further, Syed Hussain said that the government has to lay proper and adequate foundations for Progressive Wage Model (PWM) to be implemented.

"The government can establish tripartite committees consisting of unions, employers and the government to formulate and implement PMW.

"Not only that, the government can discuss on how to map a clear career pathway for employees' wages to be linked to training, upskilling, reskilling and improvements in productivity and standards. Continuous upskilling and reskilling is very important as we are now in AI and IR 4.0 era," he added.

Syed Hussain further stated that if the government intends to make increments mandatory, the government should give grants or allocations for topping up to meet the government's determined salaries.

"MEF appreciates if Rafizi as the Economy Minister and the government can come up with a scheme that tops up what is market determined wages if he is so concerned of raising the salary of employees," he said.

"The Human Resources Minister has various levels of discussion on these issues.

"There are existing tripartite committees where MEF, MTUC or Cuepacs all meet and discuss human resources issues including wages.

"Within the tripartite mechanisms, the National Wages Consultative Council (NWCC) is formed to discuss about minimum wages and related issues.

"We have various committees and the National Labour Advisory Council (NLAC) that meets to discuss these matters.

"Matters relating to wages should be in the hands of the Ministry of Human Resources and not under Economy Minister, therefore, Rafizi should focus on making the nation's economy better and more vibrant," he said.