MEF: Update labour laws

28-01-2009: MEF: Update labour laws
by Chua Sue-Ann

KUALA LUMPUR: Both employers and workers are in for a hard time this year unless the government swiftly implements the planned stimulus packages and update labour laws, said union and employers organisations.

Malaysian Employers Federation (MEF) executive director Shamsuddin Bardan said while fiscal stimulus was urgently required to boost the economy, the government should also consider a longer term measure in reviewing labour laws and policies to give employers more flexibility during periods of economic downturn.

With many manufacturers opting for a temporary two- to three-week cease in operations due to a slump in demand, Shamsuddin said there needed to be clear-cut policies to determine if the affected employees could take partial salaries, annual or unpaid leave, which he said could be a better alternative than facing job cuts.

Human Resources Minister Datuk Dr S Subramaniam was quoted by Bernama last week as saying the temporary shutdowns would affect 45,000 workers while 14,000 workers from various sectors had lost their jobs, as of Jan 12, due to the global economic slowdown.

Shamsuddin added some manufacturers had indicated it may not reopen after Chinese New Year although it was difficult to ascertain how many companies were mulling over such a move with most adopting a "wait and see" attitude.

He also said the Employment Act, passed in 1955 when the economy was largely based on agriculture and mining, should be updated to accommodate the needs of the current economic sphere of activity where service and manufacturing sectors had more prominence.

Shamsuddin is estimating job cuts of between 170,000 and 200,000 jobs, including those opting for the voluntary separation scheme (VSS), if the current global economic downturn persists throughout the year.

Malaysian Trades Union Congress (MTUC) secretary general G Rajasekaran said business owners and employees would be anxiously monitoring the year's first quarter for signs of potential improvement in the world economy as well as the spending of the government's stimulus package.

"If there are signs that the RM7 billion would be put to good use, people would be willing to wait and bite the bullet for a little while as employers don't want to lose their trained workers," said Rajasekaran.

He said business owners would be looking to re-strategise after the first quarter in the event that the demand slump was due to the global financial crisis rather than the usual seasonal slowdown in manufacturing post-Chinese New Year.

Rajasekaran said the current sentiments amongst employers and unions were "largely bad news", as there were reservations as to whether the Malaysian economy was resilient enough to weather the current financial crisis.

Meanwhile, a survey of 1,700 Malaysian companies from various industries by recruitment website JobStreet.Com found that only 14% of respondents indicated they would employ more new staff in the first quarter of this year compared with 55% during the same period last year.

Additionally, 56% of companies polled said they would be hiring fewer new employees compared with 13% last year while 30% of respondents said their employment rate would remain the same.

The survey, conducted in December 2008, also found that 70% of companies said employment prospects for the first quarter of this year would be "slightly or much worse" than that of the same period last year while 11% indicated optimism compared to last year.

According to the survey, marketing and business development were the most sought-after job specialisations by employers followed by computer and IT software skills, which displaced accounting skills in the most wanted specialisations.

Panasonic to cut 560 jobs, close Asian plants

By SHINO YUASA – 8 hours ago

TOKYO (AP) — Panasonic Corp. said Wednesday it will cut 560 jobs in Asia due to the closure of two plants in the region, while declining to confirm a report saying the Japanese electronics giant will likely suffer its first net loss in six years.

The world's largest maker of plasma television will shut down a factory in Malaysia and another plant in the Philippines to "cope with a rapid change in the global electronics market," said spokesman Akira Kadota.

The closures come as Panasonic is in the middle of a $9 billion takeover of smaller Japanese rival Sanyo Electric Co. to become one of the world's biggest electronics companies.

Around 500 workers at the Malaysian electronics parts plant in Malacca will be out of work, while some 60 employees at the Philippines battery factory will also lose their jobs, Kadota said.

Panasonic also runs two electronics parts plants in the central Malaysia state of Selangor. The spokesman said the company will merge them into one by September. He could not give the number of workers at the Selangor plants, but added the move will not result in job losses.

Kadota declined to confirm a report that Panasonic will likely suffer its first net loss in six years due to plummeting global demand for electronics goods and a strong yen.

Citing no sources, Japan's top business daily, the Nikkei, said Wednesday Panasonic may incur a net loss of about 100 billion yen ($1.1 billion) in the fiscal year ending March 2009. It would mark the first net loss in six years for Panasonic.

In November, Panasonic slashed its net profit forecast by 90 percent to just 30 billion yen. But the Nikkei said the company will likely plunge into the red as sales continued to deteriorate at home and abroad amid a deepening global downturn. Profits were also hit by a surging yen, which hurts Japanese exporters like Panasonic by eroding their overseas income.

The Nikkei said Panasonic's operating profit will be also worse than its forecast of 340 billion yen. The paper did not give any projection for the operating profit.

Panasonic last year changed its official name from Matsushita Electric Industrial Co., shedding the name of its charismatic founder in favor of its more internationally known brand.