Cuepacs calls for minimum 10% salary hike to cover rising costs

November 20, 201410:53 am518 views
Cuepacs calls for minimum 10% salary hike to cover rising costs
Cuepacs calls for minimum 10% salary hike to cover rising costs

The workers’ union has called on public and private sector employers to consider a salary increment of not less than 10% to commensurate with employees’ increased productivity and performance in the country.

Congress of Union of Employees in the Public and Civil Services (Cuepacs) president Datuk Azih Muda said salary increment should also take into consideration the current rise in the cost of living, particularly increase in the prices of goods and services.

In addition to sustaining daily needs, an employee, especially a civil servant should at least be able to afford to buy a house and support his or her children’s education, he said.

“Salary is determined by certain factors, such as academic qualifications, experience, and the ability of an employee. The cost of living is also considered.
“However, the workers’ salary these days are not able to cover the real cost of living,” he said when contacted by Bernama today.

A Khazanah Research Institute study presented on Monday reported that workers’ salary increment was necessary in view of the fact that Malaysian workers’ productivity had been increasing since 1960.

The institute’s managing director, Datuk Charon Mokhzani reportly said that for more than 50 years, workers’ productivity level had always exceeded the salary given by employers, and since then too, salary increase did not correspond with workers’ productivity.

With this situation, workers were content with salary and benefits of about only 33% of the Gross Domestic Product (GDP), while the rest were enjoyed by the company and its stakeholders, noted Charon.

Malaysian Trades Union Congress (MTUC) secretary-general N.Gopal Kishnam, who was in agreement with Azih, said an increment of more than 10% would help Malaysia achieve developed nation status.

The salary increment would also stimulate economic growth as it would increase consumers’ purchasing power, he added.

Malaysian Employers Federation (MEF) executive director Datuk Shamsuddin Bardan however, differed when he pointed out that the actual increase in productivity was not much when compared with the annual salary increment given to workers.

For example, he said, according to a Malaysia Productivity Corporation (MPC) report, the average increase in labour productivity was about 2.5% in the past 10 years.

“However, if we look at employees’ annual salary increment, particularly in the private sector, the increase is between 5% and 6%.

“This, definitely exceeds the rate of increase in productivity and the rate should also be compared with the current actual productivity rate, which is about seven times lower than productivity rate in the United States and Japan.

“Therefore, to say that salary increase is not high when compared with productivity, is simply untrue,” he added.

Asked to comment on the Khazanah Research Institute study report which stated that purchase of a house based on the annual salary median was still more expensive than the actual price, Shamsuddin said the government was responsible in controlling prices to make houses affordable.

According to Kishnam, the government should build more affordable housing specifically for the low and middle income earners, considering that prices were determined by the current market.


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