NST Leader: Labour pains

PROGRESSIVE wage is the way to go for Malaysia. Sadly, employers are standing in the way of its implementation. This is rsegressive.

Employers in at least the shape of three — the Malaysian Employers Federation (MEF), Federation of Malaysian Manufacturers (FMM) and the Small and Medium Enterprises Association of Malaysia (Samenta) — are already busy reviving an economic battle of old, capital versus labour.

As investors in capital, they must surely know this, but it bears repeating: no nation can grow on employers' profit alone. Like capital, labour is a factor in production. This must be brought home to the MEF, FMM and Samenta. This economic reality hasn't changed much since the days of our old master of economics, Adam Smith.

Perhaps artificial intelligence will change this, but that is a story for the end of human history. Until then, capital and labour must seek to enrich each other. Because the failure of one is the death of the other.

Perhaps a question needs asking: why are employers decrying the implementation of progressive wages? It adds to the cost of their commerce, contend the employers. We have no dispute with this argument.

But it misses a point — an important one. The progressive wage is all about a higher wage for higher productivity. The solution is for employers to make their employees more productive by upskilling them. They seem reluctant to do this. Employers' narratives in the public domain suggest one thing: the government should subsidise the cost of their employees' skills training.

Or, better still, subsidise their wage increase. What happens to the extra profit generated by the government subsidies? It is for the employers' keeping. This is a case of having the cake and eating it. Employers' economics mustn't be this freakish. We must all accept one economic reality, no matter which side of the progressive wage debate we stand on: capital without labour cannot move commerce forward.

Putrajaya knows that its progressive wage model is arguably the most contentious reform agenda of the unity government. Lined up against it are MEF, FMM and Samenta with their gloves out on the first mention of progressive wage. While the employers have the strength of their associations behind them, employees in Malaysia, with a few exceptions, are left to fend for themselves. This is especially true for low-skilled foreign workers.

The law takes care of them up to a point. It refuses to inch any further because lawmakers have the ears of employers, not their employees. The capitalists are more willing to fund their lobby to keep the progressive wage at bay than the welfare of their employees.

Is this why Putrajaya says the progressive wage is going to be the most contentious item on its reform agenda? Perhaps. Labour is just not equipped to withstand the onslaught of capital as an organised force. This must change. By this, we do not mean that Putrajaya must be unjust to employers, who, after all, provide the capital to commence the commerce on which labour depends.

Putrajaya must be fair to employers and employees. The former must be allowed to enjoy their just profit and the latter their just wage. Today's minimum wage of RM1,500 is certainly not a just wage. Employers must prove to Putrajaya that they would not make any profit by paying their employees progressive wages.

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