It said the roadmap should ensure Malaysia achieved the 48% compensation of employees per GDP envisaged in its Shared Prosperity Vision 2030 (SPV2030).

In a statement the coalition’s co-chairmen N Gopal Kishnam and Irene Xavier laid out a number of suggestions for the government to consider.

Responding to the government’s announcement that the minimum wage of urban workers would be set at RM1,200 in 2020, they urged for a standard minimum wage of RM1,200 regardless of the urban-rural divide.

They said the geographical-based minimum wage system was not suitable for the Malaysian labour market as the government itself had estimated that 77% of the Malaysian population would live in urban areas in 2020, in comparison with 55% in Indonesia and 35% in Vietnam.

“In fact, the urban-rural boundaries are not very obvious in the country. For instance Teluk Panglima Garang and Bangi are not entitled to the new minimum wage rate, but both are at the margins of urban areas with high cost of living.”

They said the primary aim of the government’s Shared Prosperity Vision 2030 was to provide a decent standard of living to all Malaysians and that one of the key indicators was to increase compensation of employees per GDP (CE) from 35.7% in 2018 to 48% by 2030.

“The CE indicator is of paramount importance as it reflects that when an enterprise earns RM1, only 35.7 sen goes to employees, the remaining goes to employers and the government.

“In a more economically just society, employees usually get about half of the CE. For instance, German employees get 51.5 cent and United Kingdom employees get 49.4 cent.”

Saying the target set by the government had the full support of unions and others, they expressed concern about how a slow pace of minimum wage increment could achieve the 48% CE target “given that Malaysian workers are severely underpaid”.

They noted that a Bank Negara Malaysia (BNM) study showed that Malaysian workers were paid only one-third that of selected benchmarked economies.

“A Malaysian worker receives only US$340 when his or her productivity is US$1,000. BNM recommended that Malaysian labour laws must be revamped to ensure Malaysian workers get fairer share of enterprise profits.”

They called on the government to devise a comprehensive plan to achieve the 48% CE, adding that this required more policy tools than just a minimum wage system.

Their suggestions include:

• Reforming labour laws to facilitate realisation of SPV2030 goals;
• Facilitating union recognition and the collective bargaining process by changing the secret ballot formula based on votes cast and taking stern action against employers who intimidate workers in seeking recognition process;
• Ensuring free collective bargaining to help industrial workers bargain for higher wages if the industry performs well in the year; and
• Carrying out major reforms in the industrial court system so that ambiguous laws are set right and worker interests better safeguarded. This includes preventing the industrial court from making “arbitrary decisions” to suppress wage proposals put forward by trade unions that refer the matter to the industrial court for dispute settlement.

“We hope the Cabinet will set up a special committee to deliberate these proposals and formulate a comprehensive plan to realise 48% CE target of SPV2030”, Gopal Kishnam and Irene said.