Deal-with-shortage-in-workforce

How SME can deal with ‘Shortage’ in workforce, increase in ‘Minimum Salary’, ‘Flexible Working Arrangements’ and Reduced in Weekly ‘Minimum Working Hours’.

How SME can deal with ‘Shortage’ in workforce, increase in ‘Minimum Salary’, ‘Flexible Working Arrangements’ and Reduced in Weekly ‘Minimum Working Hours’.

With the recovery from the Pandemic, SMEs in Malaysia have been experiencing shortage in the workforce especially in foreign workers in the construction, plantation, manufacturing and food & beverage industries. This has resulted in higher cost of operations as many SMEs are already putting their existing workforce on overtime.

As for office workers, many Employers are struggling the same to hire suitable candidates as many job seekers are now asking a much higher basic salary which does not commensurate with their jobs skills and deliveries.

This is contributed partly from the mandated increase in minimum wages as well as the overall higher cost of living arising from material and logistic costs increase as well as cost of production. With the review of the fuel subsidy and the price of fuel, any reduction in subsidy and fuel price upward movement will further add on to the cost and inflation pressure.

The recent amendments to the Employment Act 1955, which aims to safeguard the welfare of workers, in line with the International Labour Organisation (ILO) Convention, has provided for employees to be able to apply for flexible hours including flexibility to work from home during emergencies such as the Covid-19 pandemic as well as reduced weekly working hours from 48 hours to 45 hours.

Pending the implementation order, provisions of the amendment could not be implemented, is for employers to have enough time to adjust their operational hours to meet the new requirements of the 45-hour work week. This will impact those who have shifts.

So what can Employers do with the recent amendments

  1. Certain sectors will bound to set daily targets such as creating and implementing revised Job Descriptions, Key Performance Indicators to manage cost to productivity ratio with the increase in Minimum Wage. This will requires a lot of planning
  2. Create and Introduce Flexible Work Policy as a guideline and parameters between Employers and Employees. This can be added on the employment handbook.
  3. Companies to embrace new technology to modernise their operations to reduce the impact of the new rulings. Example as e-waiter where the robot replaces some workers in sending food or Online App based food ordering for customers to order food. With the adoption of automation, Employers can cut down on manpower and costs while maintaining productivity.
  4. Companies can outsource part or some of their non-core business processes as outsourcing can save from 40% without the headache of looking for staffs or to handle overtime as many outsource provider provide a fixed fee delivery option similar to what InTune Outsourcing is providing.

For many Small Medium Enterprises (SME)s who do not have a dedicated Human Resource Department to manage this may requires a certain level of customisation and adjustments based on business to business. This is where InTune can provide HR consultancy to set this up on top of our payroll outsourcing.

This is essential part in managing, growing and retaining talents for the 21st century and it can be customised to Small Medium Enterprises (SME)s depending on where they are. There are tools that can be used and it can be integrated to make the whole process much more easier. Talk to us at today.