Too Soon For Higher Minimum Wage Say Budget Hotels

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The Malaysian Budget & Business Hotel Association said the industry had not recovered from the effects of the pandemic. (Facebook pic)PETALING JAYA: The government’s decision to increase the minimum wage to RM1,500 in May will cause more harm than good as it is “too soon” and will raise operating costs, say hoteliers.
Sri Ganesh Michiel, deputy president of the Malaysian Budget & Business Hotel Association, said members of the association were surprised by the announcement and felt that it was an unfair decision.
“The hotel industry is still recovering, and our operating costs will go up as a direct result of the announcement. Hotel operators will need to raise the selling price of a service or product. This will then burden the consumer,” he said in a statement today.
Earlier, Prime Minister Ismail Sabri Yaakob told the Umno general assembly that the new minimum wage of RM1,500 – which was previously intended to be in force by the end of the year – would come into effect on May 1.
Sri Ganesh Michiel.The increase from the current rate of RM1,200 affects companies with five employees or more.
Sri Ganesh said unemployment would rise, as employers would be forced to lay off workers or not hire new employees in order to cut costs.
“Most hoteliers are facing cash flow problems and it takes a long time to recover. We do not have the ability to pay,” he said, urging that the increase be postponed “until a proper mechanism is established”.
Sri Ganesh said the government should impose a wealth tax and capital gains tax on the rich, and cross-subsidise to ensure a minimum wage for underprivileged workers.
S Arutchelvan.However, Parti Sosialis Malaysia deputy chairman S Arulchelvan said the party welcomed Ismail’s announcement.
“Historically, this is the biggest jump so far, as it’s an increase of RM300 in one go in a short period of time.
“Although the amount is still lower than what was requested by MTUC (Malaysian Trades Union Congress) and Cuepacs, which is RM1,800, it’s a victory for those of us who have kept pushing for RM1,500 now and not later,” he said in a statement. - FMT

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