Malaysia is one of Asia's biggest employers of foreign labour. But recently, cases of deaths, abuse and forced labour have come to light. What is going on? Who is protecting these migrant workers?
The Malaysian Trades Union Congress (MTUC) was very pleased when the land development minister announced that his ministry is organising a seminar to allow all stakeholders to have a meeting of the minds to find a holistic solution to the manpower issues in the oil palm industry in Sarawak. The minister had in his initial announcement indicated that all stakeholders, including workers groups will be invited. We believe that we can work together find solutions.
MTUC is the largest private sector labour organisation and an international and nationally recognised tripartite partner of the Malaysian government in all matters of labour and human resources for the past 60 years.
It is deeply regretful that workers groups are not included to present data and articulate their views and put forward suggestions during the seminar. How do we resolve labour issues without meaningful participation from a key stakeholders-labour and workers? To simply allow one or two questions from the floor is condescending and a sign of lack of respect for workers. This may be the reason why local workers avoided plantations. Even retrenchments are carried out in a secretive manner.
The organisers lauded the seminar as a transparent approach to seek all views. However, only plantation growers and govt agencies were given opportunities to present detailed papers and views. There are no NGO representing other stakeholders, resulting in unbalanced views skewed in favour of industry players.
As such the criticism by Dr James Masing of the poor response from NGOs is uncalled for. They can’t expect MTUC or another group to offer constructive proposals if they are excluded from the consultations. It is also not logical to blame NGOs for failing to find workers for plantations as NGOs do not have any say over the remunerations and wages in the sector. We are also not employment agents earning fees.
Notwithstanding the above, MTUC lauded the paper presented by the Sarawak Land Consolidation & Rehabilitation Authority (Salcra) as it is informative, frank and sincere acknowledgment of the many challenges faced by the industry. Similarly the Sarawak Dayak Oil Palm Planters Association recognise the issues and challenges.
However MTUC find that some of the figures and assertions made by the Sarawak Oil Palm Plantation Owners Association (Soppoa) were not accurate and or grossly exaggerated.
It claimed that because of the shortage of 12,804 harvesters, the industry lose RM2.8 billion in revenues. It claimed that 5.56 tonnes of fresh fruit bunches are left to rot resulting in loss of crude palm oil production of 1.13 million tonnes.
According to its figures the current 38,804 harvester produce 3.7 million tonnes for 2015. This means that production would have total 4.9 million tonnes if the 12,804 workers can be found. With a 1.25million planted hectares including immature plantations, the CPO yield and productivity per hectare would be higher than Peninsular Malaysian- contrary to Soppoa’s own claim that they not pay higher wages because productivity and yield is lower in Sarawak.
Labour productivity increased by 100pct
Labour–hectare ratio has improved from 1:5 hectare to 1:10. This mean that labour productivity has improved by 100 percent. Where are the corresponding improvements in employee benefits?
It is also misleading for the industry to claim that foreign workers have higher productivity than local workers. Workers productivity must be measured in value added per worker per hour worked, not total output. Foreign workers produced more because they work longer hours. This must be expected as their only focus are to earn as much as possible to be send back home to their families and to pay off debts incurred as a result of the cost of coming here.
It is unreasonable and unrealistic to expect the same from local workers who have family, societal even cultural, religious and community obligations.
The industry should develop a system of part time and seasonal employees to meet seasonal demand. However such system can only work if the remunerations are attractive enough for workers to cover their cost of employment i.e. transport, food, lodging and opportunity.
Soppoa’s claim that plantation wages are similar to other industries sectors is not supported by data from the National Wages Consultative Council Technical Committee.
The figures presented at the seminar showed that Executives and supervisors have a starting pay of just RM800 per month – which is the statutory minimum wage. Please note that a minimum wage is not an employer benefit. It is a statutory right. To put this in proper perspective the poverty line index for Sarawak is RM942 per month
Eight out of 15 jobs at estate offices start at minimum wage. Fourteen out of 24 job grade at palm oil mills start at the minimum wage. Each and every estate field worker starts at RM800 to a maximum of RM1,200 per month. This mean even after 20 years working their salary is just RM1,200 a month. The so-call productivity link piece rated system of remuneration in the industry has contributed to the malaise and the shortage of workers.
The minimum wages is supposed to cover only the lowest value jobs and inexperience job holders. If indeed the shortage of 13,000 workers can result in revenue loss of RM2.8 billion, surely the value of their jobs should be higher than the minimum wage.
Despite claims of high costs of employing foreign workers, local workers are offered only minimum wages. At the very least, the cost of bringing foreign workers, including housing, levies should be pro-rated and offered to local workers.
Soppoa makes a comparison with New Zealand, saying that New Zealanders are proud of their sheep and that we should be proud of our palm trees. In New Zealand the average salary of farm workers is NZ$57,000 per annum and is NZ$5,500 higher than the NZ national average wage.
We don’t deny that the plantation industry is an important industry. It is in the national interest to make the industry sustainable. However it will not be sustainable if it continues to provide only low value jobs at minimum wage.
As we move towards developed nation, it is no coincidence that more and more Malaysians aspire to a tertiary education so there will be less and less Malaysians available to perform menial and unskilled jobs and 3D jobs.
Only creating jobs for foreigners?
This raise the issue of whether it is wise to open up so much land for oil palm only to create 3D jobs for foreigners and train them so that they can become skilled workers and go back to their countries. It also compromise food security as most land are taken up for plantation and divert investment for other sectors such as tourism. We will leave environmental and land issues for another forum.
In 2014 Human Resources Minister Richard Riot has been reported to have said that there could be as many as 5.7 million workers, both legal and illegal. He warned that foreign workers could control our economy, if given the opportunity. Already they are monopolising the semi-skilled sectors like plantation and construction. He urged employers to give reasonable and fair salaries to locals.
We should not be surprised that going forward, foreign workers will be reluctant to work in the sector as data showed that even foreign workers are absconding to the other sectors as admitted by the Malaysian Planters association (Mapa) and Salcra (about 50 percent).
It is illuminating that the executive director of Mapa stated that the rehiring programme is causing problems for the plantations because legal workers in the plantations will conveniently lose their legal document to become illegals so they can be legalised to work in other sectors.
Is this not an admission that even foreign workers do not want to work in plantations? Yet they have been complaining that cannot attract locals. They should seriously improve working conditions in the plantation and estates. They should stop opposing minimum wage.
The government and even employers’ association are urging that we need to move toward automation and technology to reducing reliance on labour intensive jobs. Are we really serious in this push? Investment in technology cost money and every business will want the cheapest way of doing business. If labour is relatively cheap, they will continue to rely on low cost labour.
Soppoa’s claim that oil palm is a sunrise industry. Perhaps we should be reminded by the wise words of our honourable chief minister in early March.
Hence we need to accelerate the state economy growth by restructuring our economy by focusing on creating high income opportunities in new economic areas rather paying attention to marginal improvements in traditional sectors such as producing raw materials in the agricultural industry.
ANDREW LO is secretary, MTUC, Sarawak Division.
Address: Wisma MTUC,10-5, Jalan USJ 9/5T, 47620 Subang Jaya,Selangor | Tel: 03-80242953 | Fax: 03-80243225 | Email: firstname.lastname@example.org