PETALING JAYA | The local hotel industry has already laid off 6% of its employees, with a growing number of its staff taking unpaid leave and pay cuts as the sector crumbles from the impact of the Covid-19 pandemic.
According to the Malaysian Association of Hotels (MAH), based on a sampling size of 41,000 employees, 20% of were already given pay-cuts, while another 26% are on unpaid leave.
The highest number of lay-offs were in Melaka (15%), Johor (12%), Perak (12%) and Negri Sembilan (11%). Kedah, Perlis, Pahang and Kelantan have yet to report any lay-offs.
Pahang and Kelantan, however, reported the highest number of employees given unpaid leave at 54% and 50%, respectively.
Meanwhile, areas with the highest number of employee pay cuts were Langkawi (33%), Johor (32%), Selangor (32%) and Perak (30%).
Malaysian Association of Hotels (MAH) chief executive officer Yap Lip Seng(pic below) said the bulk of the employees within the local hotel sector did not qualify for the Employment Retention Programme (ERP), which was issued by the Social Security Organisation.
“For the ERP, 52% responded that they did not apply, with majority citing reasons that they do not qualify, not imposed unpaid leaves for at least 30 days in a month or would instead opt for wage subsidy.
“As for the (RM13.8bil) wage subsidy programme, 23.46% did not apply mainly due to the six-month retention clause and that the amount is insufficient for the hotel to sustain paying out in full to employees even with the subsidy, ” he said in a note.
Based on a survey of 324 hotels, Yap said 93% of hotels needed a minimum six months of wage subsidy to survive, while 74% asked for higher subsidy, adding that the current amount being offered by the government is insufficient.
“Almost 30% proposed to increase the wage subsidy to RM1,500 per employee per month, 17% wanted RM1,200 (these are the ones that do not qualify for RM1,200 based on current mechanism) and 16% responded that RM2,000 would be the right amount.”
Meanwhile, Malaysia Budget Hotel Association national deputy president Sri Ganesh Michiel said its members were finding it difficult to apply for Bank Negara’s special relief fund (SRF), which was increased to RM5bil under the special stimulus package for small and medium enterprises.
“We received negative feedback from our members who are hotel owners and operators on the SRF. We feel that financial institutions are strict in granting the funds as they believe that the sector is a high-risk industry. We think this is not fair on the hotel sector, which has been badly affected by the Covid-19 pandemic.
“We urge and seek assistance from the government to take immediate action by drafting an act of law to make all the measures announced earlier and in the future by the government to assist the hotel and all other related industries to be compulsory under an act, ” he said.
