Progressive wages not a silver bullet
KUALA LUMPUR: The Malay Economic Action Council (MTEM) says the progressive wage model (PWM) is not a silver bullet to solve the country’s wage issues.
“The Malaysian government has announced that it is pursuing a progressive wage model (PWM) similar to that of Singapore.
“This is a positive step, as the PWM has been shown to be effective in raising wages and improving the working conditions of low-wage workers in some sectors in Singapore,” said MTEM chairman Norsyahrin Hamidon in a statement today.
Norsyahrin said Singapore implemented the PWM in four sectors — cleaning, security, landscaping, and retail.
The wage rules cover not only the lowest paying jobs but also higher positions, such as supervisors and managers.
“The PWM works by setting a basic (minimum) wage for each occupation in a sector, and also stipulates the wage increments over five years.
“So in these respects, there are good features of the PWM that Malaysia should adopt. However, it is not a silver bullet,” he added.
Nursyahrin said Malaysia should continue with the current minimum wage policy that covered all sectors.
He also urged the government set targets to ensure that the majority of workers earned a living wage.
“For instance, the government could, in the Mid-term Review of the 12th Malaysia Plan, set a goal that by 2025 only 40 per cent of households are below the living wage threshold, and by 2030 only 10 per cent. This will provide a clear overarching goal of the government wage policy,” he said.
Nursyahrin said in the long run, the government needed to adopt a broader approach to address the issue, such as reducing the number of foreign workers, encouraging unionisation of workers, and promoting collective bargaining and also resetting industrial and investment policies.
