THE Malaysian Employers’ Federation (MEF) has proposed a “nine plus five” formula to employers and workers to deal with the problem of wages during a business shutdown beginning today.

Businesses except those classified as “essential services” will be ordered to shut temporarily their premises until March 31 as the government attempts to control the spread of the coronavirus (Covid-19).

The MEF proposal calls for employers to give an extra nine days of paid leave while employees spend five days of their annual leave, said MEF executive director Shamsuddin Bardan.

If a worker has exhausted his annual leave, he should take five days of unpaid leave, said Shamsuddin.

This formula would hopefully convince small- and medium-sized enterprises (SMEs) not to shed their workers when their operations are suspended.

“The formula aims to create a win-win situation where bosses and workers will have to share the burden of no revenue during the 14-day period,” Shamsuddin told The Malaysian Insight.

“What we suggest is a fair and reasonable proposal for a win-win situation.

“To ask that employers pay wages without work is asking too much and to ask employees to get no pay because of forced leave is also asking too much.”

During the movement-control order, businesses deemed non-essential must close their premises or inform their employees to work from home.

Those on the essential list include firms in the following sectors, water, electricity, telecommunications, post, transport, oil and gas, banking, healthcare, pharmacies, prisons, ports, airports, security, defence and food.

Supermarkets and sundry shops will also be allowed to remain open while restaurants will only be able to do deliveries or take out.

SMEs have already started to complain that the shutdown will affect revenues and cause some to either retrench their workers or put them on no-paid leave.

The proposal is being circulated to all 22 of the MEF’s member associations, which include those in the mining, plantations, hotels and banking sectors.

Together, MEF’s members employ more than one third of the 6.4 million workers in the private sector.

Although the government wants employers to pay wages for the full 14 days, many SMEs are thinking of retrenching their workers instead, said Shamsuddin.

“It is up to individual employers to adopt the formula but we are seriously encouraging them to do so and not to retrench.

“If you retrench and the situation improves in two weeks, you will be left without workers when you need to restart operations – and it is more expensive to rehire and retrain workers.” – March 18, 2020.