PETALING JAYA: This is not the right time to increase the set minimum wage, says the security industry.
Security Industry Association of Malaysia (PIKM) president Datuk Seri Ramli Yusuff, referring to recent statements from Human Resources Minister Datuk Seri M. Saravanan, said that if the plan went ahead, many members of the association would be forced to cease operation due to losses.
“The time is not right and if it proceeds, many will go bankrupt,” he said.
“It’s not as simple as a RM300 increase because many other costs need to be taken into consideration, such as overtime payments.
“If the wage increase goes through, we may have to pay an average of RM3,300 per security guard after adding EPF and Sosco payments,” he said told a press conference here yesterday.
Ramli said hiring fees would need to be increased if the minimum wage was increased, adding that the association estimated that the hourly charge could be at least RM11 just to break even.
“This would make it even harder for employers to find clients.”
Ramli said another problem was that payment for past contracts had also not been made in full, due to revised fees from the last minimum wage hike.
“We don’t have the exact figure but it’s worth millions (of ringgit),” he said.
“The contract negotiation started before the wage was increased to RM1,200 and many of us had to pay the difference to our staff upfront before we even saw the revised fees years later,” he added.
He said PIKM members would be willing to pay the proposed wage increase but their customers would have to agree to the rise in fees.
“With the pandemic affecting so many businesses, many won’t even go near that figure. They will start using these illegal companies.
“We have also provided employment for over 100,000 workers locally.
“If employers start closing shops, employees will also be affected,” he said.
Saravanan said that a minimum wage of around RM1,500 would be implemented by the end of the year.