PETALING JAYA: The call for the private sector to emulate the Governments golden handshake retirement benefits has drawn contrasting responses from unions and employers, with the two parties adopting opposing stands.
Malaysian Employers Federation (MEF) executive director Shamsuddin Bardan said the suggestion was impractical and unsuitable for the private sector, where workers tend to job-hop.
Shamsuddin said private sector employers have provided sufficiently for workers retirement plan via EPF contributions, with some companies chipping in extra every month to give workers a bigger saving in their old age.
Private sector employees are unlike public servants, who only contribute short-term to EPF and fall back on the pension scheme. Thus, public servants may have more urgent need to convert their accumulated leave into cash.
He added that some companies allowed cash in lieu of leave up to 30 days and untouched leave would be forfeited after a year.
We believe workers need the rest. In the eagerness to convert annual leave into cash, we are afraid that workers may make up excuses, such as taking more medical leave, to have their break, he said.
On Friday, Public Service Department director-general Tan Sri Jamaluddin Ahmad Damanhuri said the golden handshake for retiring civil servants had been increased by a further 30 days to 120 days for cash in lieu of leave throughout their service.
The following day, Human Resource Minister Datuk Dr Fong Chan Onn suggested that this be adopted by the private sector.
MTUC secretary-general G. Rajasekaran lauded the call by Dr Fong, saying private sector workers needed to build up more cash for retirement because once they retired they were left to their own devices, unlike public servants, who can still enjoy subsidised healthcare and other benefits from the Government after retiring.
Rajasekaran said some private companies did practice golden handshake but the benefits were only given to top management.