FMM said any last-minute holiday declarations will severely impact industries with tightly scheduled operations, particularly in manufacturing.
PETALING JAYA: The Federation of Malaysian Manufacturing (FMM) says the government should provide legal clarity on Malaysia Day as an additional public holiday on Sept 15, warning that ad hoc holiday declarations could cost the manufacturing sector up to RM1bil in losses.
In a statement, it called for the prompt gazette of the holiday under the Holidays Act 1951.
“This is critical to provide legal clarity and enable businesses to plan operations, workforce scheduling, and ensure compliance with the Employment Act 1955,” it said.
On July 23, Prime Minister Datuk Seri Anwar Ibrahim had declared Sept 15 as a public holiday in conjunction with the Malaysia Day celebrations.
The Human Resources Ministry subsequently stated that employers are required to observe the holiday.
According to FMM, while it appreciates the spirit of commemorating Malaysia Day, any last-minute holiday declarations will severely impact industries with tightly scheduled operations, particularly in manufacturing.
“The manufacturing sector is highly sensitive to last-minute holiday declarations due to tightly scheduled production timelines, export commitments, and labour shifts,” said the organisation.
It added that the additional public holiday would create a four-day disruption for many companies, especially those operating on shift-based or continuous production cycles from Saturday through Tuesday.
“Such interruptions require production lines to stop and restart, which is both costly and inefficient,” it said.
Citing past estimates, FMM stated that each unplanned public holiday can result in productivity and output losses of up to RM1bil for the manufacturing sector alone.
Industries most affected include those with continuous processes such as steel, chemicals, and food processing, while small and medium enterprises, in particular, might struggle to absorb the costs or reorganise replacement shifts.
“The disruptions also have a cascading effect across supply chains and logistics operations,” it stated.
FMM stressed that frequent ad hoc holiday declarations undermine Malaysia’s credibility and attractiveness as an investment destination.
“Policy announcements must reflect clarity, consistency, certainty, and credibility. Frequent ad hoc holiday declarations do not augur well for a country striving to achieve high-income nation status and position itself as a competitive, reliable, and attractive destination for investment.
“Investors and global buyers require predictability and stability,” it added.
FMM advised employers to monitor the official gazette notification, adjust production schedules accordingly, and maintain clear communication with customers, suppliers and workers to minimise disruption.
