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  • Writer's pictureAzira Aziz

Trade Union Strikes : Revising Pay Scale/Structure for Workers

The recent J&T workers strike is an example of where the company’s failure to communicate internally with their human resources/manpower prior to adjusting pay-scale/reward system. In my humble opinion this situation is preventable. The operational (customers orders) and reputational damage will make it hard for J&T to recover.

SME Association of Malaysia president Datuk Michael Kang, said that there must be a balance between the individual objectives of both parties the employer and the employees: “for the employer, it’s saving the company, and for the employee, it’s ensuring that he still has a job – are met” during this difficult COVID19 pandemic.

In any industry, ensuring that your staff/manpower is paid decent living wages is the bare minimum especially with the Minimum Wage Order 2019. J&T's Board of Directors should have taken great care in the process of revising its bonus structure. Excluding Trade Union representatives’ input and addressing concerns and feedback from Trade Union representatives backfired badly.

This isn’t the first time a delivery company’s workers went on a strike. In 2019, Foodpanda riders went on a strike after the company revised its’ payment scheme. The pay revision “under the new scheme, the riders are paid between RM7 and RM4.50 for batches of one to six.” There was a new incentive of RM100 for 60 working hours. It ended up with government intervening in the resolution of the dispute, and warranted mention at a Cabinet meeting. It has since been resolved.

The lesson here for companies based on J&T and Foodpanda’s experience is while balancing the needs of managing cost overheads, investor Key Performance Indexs, as well as profit margin a Company must always treat its human resources/manpower/workers as partners in the business.

When there are tough decisions to be made regarding the financial sustainability of the business, great care must be taken to include Trade Union representatives to not only inform them of the situation, but to allow comments and feedback from the ground which would allow the workers time to negotiate or adjust to the new structure more amicably.

In general, reasonable workers who wishes to remain employed and feels that they are valued in the Company would not object to pay structure adjustment provided there are clear communication on the reason behind it (business not making money, even Board of Directors are taking pay cuts etc). It may even spur new ideas on improving Company operations and sales from the ground up which would in turn increase your annual revenue.

Communication, as always, is key.

I prevent problems before it arises so you can grow your business with peace of mind. Please feel free to email me at for any discussions relating to law and policy.

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