EMPLOYERS complained there are not enough incentives in Putrajaya’s stimulus package to retain workers during the extended movement control order (MCO) but worker were satisfied the aid would tide them over hard times

Experts argued that Putrajaya must help companies to retain workers so that the country recovers quickly from the recession arising from the Covid-19 pandemic.

The Malaysian Employers Federation (MEF) said the qualifying conditions are too strict for the government’s wage subsidy scheme.

MEF also questioned whether the scheme is only for small and medium enterprises (SME) or also for bigger firms such as hotel chains and airline companies which have been badly hit by the outbreak.

Big firms employ thousands of workers and if they retrench their staff, the impact on families and the economy will be bigger, said MEF executive director Shamsuddin Bardan.

SME association chairman Michael Kang told The Malaysian Insight its members had hoped for new sources of revenue at a time when almost all commerce had ground to a halt.

“We are very frustrated, the stimulus covers all people and workers, but it does not help the SMEs,” said Kang.

“They subsidised RM600 for the employee but without revenue, how are the SMEs going to pay the rest of the salary?

“The employer will have to bear the salary and cost; who is taking care of us?”

Putrajaya has announced RM250 billion in measures to help businesses weather the loss of income after the government shut down most of the country to fight the coronavirus.

The MCO has now been extended to April 14, and only a handful of essential service providers are allowed to operate in the meantime.

As of yesterday, there were 2,161 cases of Covid-19 cases with 26 deaths reported in the country.

The MCO was enforced to break the chain of infections. RM5.9 billion has been allocated to a wage programme where the government will provide a subsidy of RM600 per month for three months for each worker who earns below RM4,000.

Companies applying for the scheme must prove they have lost 50% of their income since January 1 and must not terminate workers or force them to take pay cuts or unpaid leave.

The Malaysian Trades Union Congress welcomed the wage subsidy and hoped the companies would take full advantage of it to prevent lay-offs.

“As mentioned by the prime minister, all Malaysians should stay united to overcome this crisis,” said MTUC secretary-general J. Solomon.

“We therefore trust the employers will extend their cooperation for the aid given by the government for businesses and urge them to take serious note of the PM’s advice to avoid retrenchment and wage cuts.”

MEF’s Shamsuddin argued that the scheme’s conditions were too rigid.

“It means you have to open your books to the government and prove you suffered 50% losses. But what if you are not able to prove you lost 50%, but less? Do you still qualify?

“What about employees earning above RM4,000, is there no help to pay their salaries?” he told The Malaysian Insight.

Shamsuddin did not think the incentives are not enough to make companies keep their workers.

“I worry that businesses will decide that RM600 (per worker) is not enough, and they will close shop and retrench their staff. And that will be bad for all of us.” – AFP, March 28, 2020.