MEF refers to the article entitled ‘Nube slams bosses group over statement’ which appeared on Page B4 of the Business Times section of The New Straits Times newspaper on Dec 14, 2010.
On the issue of retirement age, MEF is of the position that employers should continue to be given the flexibility to manage its own employees and not be compelled by law to comply with a stipulated age of retirement.
Whilst the government had decided to raise the retirement age of employees in the public sector from 55 to 58 years, employers in the private sector should be allowed to retain its discretion to decide on retirement age as has been the practice in the past.
The fact remains that although the law does not stipulate any age of retirement for private sector employees, the majority of employers have retained their staff on fixed term contract beyond the age of 55 years.
It is absurd for the National Union of Bank Employees (NUBE) to criticise MEF’s position on retirement age. It must be noted that Article 34 of the Collective Agreement between the Malayan Commercial Banks’ Association (MCBA) and NUBE which was signed on Aug 10, 2010 did not provide for automatic extension of retirement age to 57 years. Article 34 (1) (c) of the collective agreement provides that:
“... an employee may apply to extend his/her retirement age ... Such application shall be made at least 3 months prior to their retirement age and the Bank shall subject to business requirement and the employee’s health condition approve the application and the retirement shall be extended until the employee attains the age of 57...”
On the issue of maternity leave, the government, in all its infinite wisdom, had decided not to ratify Convention 183 of the International Labour Organisation (ILO) on Maternity Protection which provides for maternity leave entitlement for not less than 14 weeks.
In Malaysia, a minimum of 60 days maternity leave is guaranteed by law in Section 37 of the Employment Act 1955 and it is the employer which pays the full monthly wages during the entire 60 days maternity leave for up to five surviving children. In contrast, maternity benefits in other countries are jointly supplemented by the employer, government and/or social security.
Based on MEF study, employers pay about RM2.2 billion annually for 60 days maternity leave where the cost of maternity leave per day is about RM36.8 million. Should maternity leave be extended to 90 days based on the present arrangement, employers would then be required to fork out an additional RM1.1 billion per year for maternity leave pay. The additional cost would pose unreasonable burden on employers and severely impact the overall level of productivity and competitiveness of the nation.
On the matter of the presence of lawyers in the MEF Council, it must be noted that they are representatives of law firms which are members of the MEF who were elected by MEF members to the MEF Council. For NUBE to accuse lawyers in the MEF Council to be only interested in escalating industrial disputes is erroneous and defamatory.
As the apex employer organisation in Malaysia, MEF would like to affirm that the national interest is central to the cause of the Federation which supports the creation of a high‐income economy based on higher productivity and increased performance of the employee. Presently, MEF is involved in many of the platforms of various government ministries and agencies in charting the way forward, including PEMUDAH, PEMANDU and the National Labour Advisory Council (NLAC). For NUBE to allege that MEF was working against the government’s New Economic Model (NEM) to transform Malaysia into a high‐income nation is puerile and malicious in nature.
For further information, contact the MEF Secretariat at 03‐7955‐7778 or fax 03‐7955‐9008.
HJ. SHAMSUDDIN BARDAN Executive Director
22 DECEMBER 2010
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