PETALING JAYA: The government has been urged to amend existing laws to require mandatory annual increment for all employees.
Malaysian Trade Unions congress (MTUC) president Datuk Abdul Halim Mansor pointed out that many employers refuse to increase the salaries of their workers and would only do so upon announcement of a new minimum wage by the government.
“The problem is these employers don’t feel the need to give increments because they are not required to,” he told theSun yesterday.
“I feel there is a weakness in our Employment Act because it does not state that an employer must increase their employees’ salaries annually based on the performance of the said staff and the company.”
He said employees most affected were those without a collective agreement (CA) signed with their companies and also non-executive staff.
Abdul Halim said this would lead to more Malaysians having less savings and purchasing power while prices of goods and services continue to increase.
Finance Minister Lim Guan Eng on Saturday said a recent study by the Agensi Kaunseling Dan Pengurusan Kredit (AKPK) found that 18% of working adults have been unable to make any savings in the last six months, and that 28% needed to borrow money to buy essential goods.
Commenting further, Abdul Halim said the government should consider making it a requirement for EPF (Employees Provident Fund) to deduct the 11% contribution from employees based on their total income for the month, as opposed to only their basic salary currently.
“If they can impose income tax based on the total income, including overtime and other allowances, why not do the same for EPF deductions?
“Some developed nations even make savings deductions close to 50% of the employee’s income. This could only mean good for their retirement later,” he said.
Meanwhile, Congress of Unions of Employees in the Public and Civil Services president Datuk Azih Muda encouraged those who were having difficulties saving to look for new sources of income.
“Be it doing Grab or starting a small business from home. It may be a medium-term plan, but it will definitely help,” he said, adding that the government needed to also play a leading role in helping to achieve this.
“We have the Entrepreneur Development Ministry who can mobilise their officers and volunteers, and help low income earners with ways to generate new income through small businesses,” he said.
“If they can get to every household with low income, it will be a revolution, where they can act as the coordinator and ensure that useful programmes are materialised.”
