Speaking to FMT, Barjoyai Bardai of Universiti Tun Abdul Razak acknowledged that the restructuring of employee benefits was long overdue, but said employers must be given time to make the changes to ensure smooth implementation.
Barjoyai said the government must first consult all the affected parties.
He was commenting on the amendments to the Employment Act aimed at safeguarding the welfare of workers and bringing local regulations in line with the International Labour Organization Convention.
The amendments were initially meant to be implemented on Sept 1 but this was postponed to Jan 1.
A group representing retail associations yesterday called for a further postponement, saying it feared adverse effects on an industry that was just beginning to recover from setbacks caused by the Covid-19 pandemic.
The group said retailers were suffering from a severe labour shortage, supply chain interruptions, high inflation and high overtime costs.
However, human resources minister V Sivakumar told a press conference yesterday that the government will proceed with implementing the amendments on Jan 1, adding that it was necessary to do so since they have already been passed in Parliament.
Barjoyai said the government could afford a second deferment of the amendments but must engage with both employers and employees for additional feedback to ensure that all would be satisfied when the changes to the Act were enforced.
Asked how the amendments would affect Malaysia’s economic outlook ahead of an expected global recession next year, he said: “The amendments will benefit employees and make them happier, which may indirectly increase their productivity.
“With benefits and an increase in income for employees, their spending as consumers will increase and boost the gross domestic product.
“But of course, if these amendments are one-sided and only benefit employees, employers may suffer and be forced to shut their businesses if they are expected to carry all the burden.”
Barjoyai said he believed the amendments were required because employers were, on average, sharing only about 37% of their value-added revenue with their workers.
Another economist, Geoffrey Williams of the Malaysia University of Science and Technology, said further postponements to the amendments would not solve anything if there continued to be bad management among retail owners.
Williams said employers had had time to adjust to the changes but had insisted on maintaining outdated practices.
He said business owners must respond positively or suffer the consequences of being unable to hire more workers.