Saturday, May 30, 2015

Najib to be blamed for MAS's failure,loss of employment of thousands, union busting,..?

Is Najib and the BN Government responsible for the failure of Malaysian Airlines - and now the loss of employment for so many (some say 6,000 - 8,000), the union busting actions, etc...?

I gave you a job...and you failed - now,is it logical to ask the same parties to work out a proposal that will save our Malaysian Airlines? Note, in my opinion, the Independent Administrator together with the Independent Advisor should have been responsible with coming up with the proposal and the planned changes to implement the proposal - but then, it is only a few days ago that the Administrator has been appointed...No time now to even study the proposal and the plans, as he is now been asked to sign termination letters that is planned to go out in a few days. Would the Administrator allow himself just to be used...a mere 'rubber stamp'? We shall see...

MAS's Independent Administrator finally appointed - not to prepare proposal but to 'sign termination letters'?

Najib Razak is Prime Minister of Malaysia since 3/4/2009 - and this is important because MAS was a Government-Linked Company(GLC), whereby the majority shareholder was Malaysia’s sovereign wealth fund Khazanah Nasional, which now is the ONLY shareholder of MAS.

In 2007, they recorded a profit of RM852 million, the highest in MAS history, and followed up with RM522 million profit in 2009,...Two years after Idris left his post, MAS suffered one of the most historic losses in aviation industry, a staggering RM2.5 billion in 2011.They made a profit of RM430 million the following year, but lost RM1.16 billion in 2013.

Guess what? Najib is also the Chairman of the Board of Directors of Khazanah Nasional...

Dato’ Sri Mohd Najib bin Tun Hj Abdul Razak

Dato’ Sri Mohd Najib bin Tun Hj Abdul Razak
Dato’ Sri Mohd Najib bin Tun Hj Abdul Razak was appointed as the Chairman of Khazanah Nasional on 7 May 2009.- Khazanah Nasional Berhad Website

And, Najib's brother is brought in as a Director - Dato' Sri Mohamed Nazir Abdul Razak. This, in my opinion, should not have happened - because he is the PM's brother who also happens to be Chairman of Khazanah. Being an adviser is OK but...

Dato' Sri Mohamed Nazir Abdul Razak

Dato' Sri Mohamed Nazir Abdul Razak
Dato' Sri Mohamed Nazir Abdul Razak was appointed as a Director of Khazanah Nasional on 1 September 2014. He is currently the Chairman of CIMB Group. Dato' Sri Nazir was the Group Managing Director/ Chief Executive Officer of CIMB Group between November 2006 and August 2014.

Now, it is very easy to shift the blame to the CEO and management of MAS, but we all know that the power really rests with the Board of Directors - they appoint the CEO, they approve the plans... Ultimate power rests with the shareholders, and in this case 100% of MAS (and possible the new company, MAB, rests with Khazanah.

Now, for a Company, the primary object is business and profits > hence terminating employees is all seen merely from a business perspective.

On the other hand, a Prime Minister being the head of government should primarily be concerned for the well-being of people - and that includes also all these workers. A Prime Minister should also be concerned about workers' rights and unions - but alas, it becomes complicated when Najib is also the Chairman of the Board of Khazanah. Now, we have also lost the ability of our PM and the Cabinet to oversee, act as check and balance, etc to what Khazanah is doing...

In short, it looks like now it is PM Najib that should be blamed for all of MAS's failings... Some have been talking that they intend to appeal to the Prime Minister to intervene to ensure justice for the workers and the unions... but how is that possible - if you go meet the Chairman of Khazanah, you are meeting the PM. If you go meet the PM to complain about what Khazanah is doing, you really are meeting with the Chairman of the Board of Khazanah...

The biggest worry now is that all the plans for saving Malaysian Airlines is now being done by the very same people who caused the failings. There really should be a Parliamentary Committee established to monitor all - without that, we may be doomed to another failure in the not too distant future...

 Malaysia Airlines Profitable Years - 1990-2014Q1

The 21 years of mismanagement that brought MAS to its knees

National carrier MAS has suffered years of mismanagement and previous efforts to steer the company on to better fortunes failed to deliver the results hoped for, say most observers. – The Malaysian Insider file pic, May 27, 2015.National carrier MAS has suffered years of mismanagement and previous efforts to steer the company on to better fortunes failed to deliver the results hoped for, say most observers. – The Malaysian Insider file pic, May 27, 2015. 

Beginning September, Malaysia Airline System Bhd, the company Malaysians know as the national carrier since 1972, will cease to exist.

It would instead be replaced by a new company, Malaysia Airlines Bhd, to be fully owned by Malaysia’s sovereign wealth fund Khazanah Nasional before a planned re-listing in Bursa Malaysia by 2019.

This, however, is not the first time MAS has been subjected to a turnaround plan or a bid to save the airline. 
It has happened several times over the course of 22 years, beginning in 1994.

This is the most comprehensive restructuring plan that MAS has been subjected to though. One that will involve a rigorous cutting down of its air travel routes and its workforce, likely to reduce it to a regional airline. But this will only work if the government and those helming this restructuring plan heed the lessons of the past.

It all began in 1994 when businessman Tan Sri Tajudin Ramli took loans from several government-linked companies totalling RM1.79 billion and then used the money to buy a controlling stake in MAS, a move that cost the government dearly some seven years later.

Then the CEO of MAS, Tajudin was badly affected by the 1997 Asian financial crisis, and the government eventually bought MAS back from Tajudin for RM8 a share - the exact price Tajudin had paid seven years before. The only difference was, this time, MAS was lingering near bankruptcy.

It had bled RM256 million in the fiscal year ending 1998 and by the fiscal year ending 2000, it bled a further RM255.7 million after tax losses. When the government bought back the controlling stake from Tajudin, the share price on the market was only RM3.68 per share.

Government linked company Danaharta eventually opted for an out of court settlement with Tajudin despite winning a legal case over the RM589 million in loans owed by Tajudin to the company.

Back in the government’s hands, MAS reported a loss of RM 1.3 billion in 2005, prompting another turnaround plan that saw them appoint current Performance and Delivery Unit (Pemandu) chief Datuk Seri Idris Jala (pic) as its CEO.

For many, Idris’ tenure was the only silver lining for a company that has otherwise made a habit of bleeding money annually.

In 2007, they recorded a profit of RM852 million, the highest in MAS history, and followed up with RM522 million profit in 2009, just before Idris took over as Pemandu CEO under Prime Minister Datuk Seri Najib Razak’s administration.

But for DAP’s Kluang MP Liew Chin Tong, a keen observer of MAS history over the years, the current state of MAS necessitates calling into question the sustainability of what Idris did during his time helming the airline.

“His whole tenure should be called into question. It shows that his turnaround had not succeeded, as what he did was to basically cut the muscle of MAS – he cut the expenditure, killed the morale of the staff, and he killed that talent pool,” Liew told the The Malaysian Insider.

He said that for all of MAS’ troubles, the workers have become an easy “punching bag” for the company.
MAS is expected to sack their entire staff and only retain about two-thirds of them for the new company, meaning that more than 8,000 people stand to lose their jobs.

“The way Idris handled MAS, resulted in a huge number of talented people deciding to move away – it’s a vicious cycle. The current CEO (Christoph Mueller) is doing exactly the same thing,” he said.

Liew said that the company is currently merely “chopping people’s jobs” to have a turnaround of fortunes.

“You have to ask if MAS actually has the talent and the morale to carry on. After all, you are running a service industry,” he said.

Two years after Idris left his post, MAS suffered one of the most historic losses in aviation industry, a staggering RM2.5 billion in 2011.

They made a profit of RM430 million the following year, but lost RM1.16 billion in 2013.

In 2014, they lost two planes – first on March 8, flight MH370, en route to Beijing from Kuala Lumpur, disappeared while leaving Malaysian airspace. What happened to the plane remains one of the biggest mysteries in aviation history.

Just four months later, on July 17, flight MH17, en route to Kuala Lumpur from Amsterdam, was said to have been shot by a ground-to-air missile while flying 30,000 feet over a conflict zone in Ukraine. None of the 298 passengers and flight crew survived.

These incidents forced Khazanah to finally de-list MAS and take it private last year, paying RM1.38 billion to compensate minority shareholders, before embarking on this major restructuring plan.

The latest state injection into MAS, from Khazanah, will be RM6 billion.

But, this was not the first time the state has injected money into MAS. Over the past 10 years, MAS is estimated to have lost RM10 billion of state money that was injected into it, according to former Prime Minister Tun Dr Mahathir Mohamad.

Overall, it is estimated that MAS lost upwards of RM20 billion of taxpayers’ money since 1994.

When it recorded its RM1.16 billion loss in 2013, the airline was bleeding between RM4 million and RM5 million daily.

The latest injection may not be the first, but with MAS having suffered such heavy losses for two decades now, the latest revival attempt will likely be a final attempt at putting the national carrier’s accounts back in the black. – May 27, 2015.

Thursday, May 28, 2015

All MAS employees terminated, irrespective of whether re-hired by MAB, entitled to same termination benefits?

UNJUST - All 20,000 employees of  Malaysian Airline System Berhad will be terminated - and they are all justly entitled to Termination or Lay-Off Benefits, irrespective that some are later employed by a NEW legal entity - Malaysian Airlines Berhad.

If it was simply a case of a name change of Malaysian Airline System Berhad to 'Malaysian Airlines Berhad' - then you could just pay termination or lay-off benefit to the employees that are being laid-off or retrenched - but this is not the case. Malaysian Airlines Berhad is a totally new company. LET US NOT FORGET THAT WORKERS ARE HUMAN BEINGS - THEY CANNOT BE HANDED OUT TO SOME OTHER EMPLOYER LIKE THINGS/COMMODITIES.

Malaysian Airline System Berhad, the soon to be former employer, should justly be paying Termination or Lay-Off Benefits to all the employees they are terminating.

Now, they are saying that they are only going to pay this 'TERMINATION BENEFIT' to Unionized employees who have a Collective Bargaining Agreement(CA) - well, what about employees who are not members of the Union - will they be sacked with no 'termination benefit' or 'separation package'? . This is so unjust.

What about Unions, that MAS have been fighting their recognition in court, who because of this still have no CA. One example is NUFAM (National Union of Flight Attendants Malaysia). Only after the employer recognition is obtained, can a Union enter into a CA. Will members of these Unions also be sacked with no 'termination benefits' or 'separation package'? This again is so unjust... 

The fact that there is also a provision for those who have been employees for more than 10 years is most disturbing. WHY? Because length of tenure will not be a factor of consideration for employment in MAB. There is a principle in law about retrenchment/lay-offs which is called LIFO (Last In First Out)  - which sadly may be ignored here. It is true that it is not applicable here because the Old Company is terminating all, and the New Company is hiring its new employees BUT given the fact that the owners of Old and New Company is the SAME, and further that the owners is a fully owned Government Company, it would have been best that this LIFO principle was adopted. 

Older longer serving loyal employees have much more financial commitments (children, home loans, etc...) and obligation, and it is also more difficult for them to find new employment in the current market. This is especially for the 'blue-collared employees'. Even if they do find new employment, it may not pay the same or more - but more likely be a lesser paying job. They also will have greater difficulty moving family to some other town where the new jobs may be. That is why the LIFO principle is fair.

Updated: Wednesday May 27, 2015 MYT 7:20:43 AM

A better MAS layoff deal

PETALING JAYA: In a last minute change of heart, more than a third of the 20,000 Malaysia Airlines (MAS) staff will be getting termination payments according to their collective agreements (CA).

The move reverses earlier reports that the payments would be about half of what is spelt out under the CA, something which left the staff very unhappy. 

Some say MAS had bowed to pressure from unions to finally give such terms, but a source close to the matter claims “they had always been working on this suggestion but the unions did not know about it”.

Whoever’s idea it may be, the unions appear to have managed to reach the corridors of power to intervene on the severance package.

Yesterday, the airline’s nine union leaders were told that the staff payout would be according to the CA and this was received with much cheer at a meeting held at MAS with the airline’s parent body Khazanah Nasional Bhd and MAS officials. 

A large chunk of MAS employees are unionised.

“It is a welcome move. It is politically and morally the right thing to do, to pay according to the CA. That is what we should get and what we deserve. 

“Fortunately, they did not use the MAS Act 2015 to circumvent. Unfortunately, not all of us will be re-hired by MAS Bhd,” said an employee.

Christoph Mueller, the CEO of MAS, was not present at the meeting, but he sent a memo to his staff late yesterday evening disclosing the latest details which were “in line with the Prime Minister’s commitment that MAS restructuring reflect fairness, compassion and transparency”.

MAS is scheduled to axe between 6,000 and 8,000 staff over the next one year as part of its plan to shrink into a smaller airline with regional focus. The remake of the airline involves the migration of assets and liabilities of the existing MAS to a new company known as MAS Bhd, which will rehire two-thirds of the workforce. 

Those not offered jobs with MAS Bhd will be given one month basic salary for every year of service for those up to 10 years of service. Those who have served MAS for more than 10 years will get 1.5 months of salary for every year of service.

The memo said senior ­management employees (vice-president and above) and those on contract were not subject to such terms. 

Those accepting the offer to join the new MAS Bhd, will be offered a sign-on payment and if they are still with MAS Bhd after 18 months, will get a retention payment.

Khazanah had initially set aside RM1.66bil for staff payouts but since they are now paying according to the CA, the total payout will be higher with some suggesting it may be as high as RM2.4bil.

Due to the change in heart, the 20,000 termination letters that were supposed to be distri­buted today by the airline will not go out as planned. But MAS is working furiously to have the letters sent out over the next few days so the staff will still get them around June 1. Those rehired will have until June 12 to accept the offer.

“The unions have also asked that the retiree benefits of four tickets per year at discounted prices remain but MAS officials said they needed more time to deliberate on it,” said a source.- Star, 27/5/2015

MASEU concern seems to be disolution and assets when should be fighting hard for worker rights?

Finally, it is happening - all MAS in-house trade unions will die. It is most disappointing that it seems that these unions and its members did not do much to fight for the rights of MAS Employees, and their unions. A perusal of reported news tells us this (we do not know what was happening behind close doors) - but the employees never even picketed, let alone strike, something that would have happened in most countries. We are talking of all the about 20,000 employees of MAS losing their jobs. I blogged about this in 2014.

Goodbye MAS Employees Union(MASEU) and other Unions in MAS? - August, 2014

MAS - Pay Cuts? Union Busting or No more Unions? > Are workers and unions to be penalized for mismanagement?- August, 2014

Even most disturbing is the fact that MASEU seems to be more concerned about what to do with the assets of the Union once it ceases to exist - 2 Extraordinary General Meetings(EGM). They are talking about forming a cooperative ....of what? MAS Employee Alumni?

Did the UNION have any EGMs earlier to talk about fighting for their members' rights? Have they given up now - when there is still time to fight for the rights of the MAS employees.

Was the leadership compromised into apathy and silence? The Unions still have a duty to fight for justice and worker rights - or have they all given up?

No room for staff unions as MAS ‘reboot’ takes off in September

No room for staff unions as MAS ‘reboot’ takes off in September
In this April 10, 2014 file photo, a Malaysia Airlines crew walks into a check in area at Kuala Lumpur International Airport in Sepang, Malaysia. Photo: AP
Published: 12:07 PM, May 27, 2015

KUALA LUMPUR — Malaysia Airlines Employees Union (MASEU), the airline’s biggest and most powerful workers union, will effectively cease to exist once MAS completes its restructuring exercise. 

MASEU, which represents some 13,500 MAS employees, is expected to be dissolved as the new management has indicated that the union did not have a place in the new company, which will start operations on Sept 1. The union, resigned to this for the moment, is looking at turning itself into a cooperative in the new entity.

MASEU executive secretary Mohd Jabarullah Abd Kadir confirmed this and told The Malaysian Insider that two extraordinary general meetings had been held recently to discuss the possible dissolution of the union. 

“We’ve decided in the meeting that firstly, we will have to dissolve the union and secondly, maybe turn it into a cooperative,” he said.

Mr Jabarullah said although the union had held two extraordinary general meetings, the most recent being on May 18, the matter would still need to be discussed further and members will have to vote at another meeting. “We will make this a secret ballot to find out what the members want,” he said.

Mr Jabarullah said the union had to take this drastic measure because under Khazanah Nasional Berhad’s plan to return the troubled airline to profit, the new management does not recognise the union.

Saddled with debts and the twin tragedies of MH370 and MH17, the government through its investment arm Khazanah Nasional, is on a last-ditch effort to revamp the ailing MAS.

It was reported that the service of 20,000 MAS employees would be terminated but two-thirds would be re-hired by a new company, MAS Bhd, which will begin operations on Sept 1.

It was understood that the new company wants to form a union consisting of its own people, who are friendly to the management.

Mr Jabarullah said the new management’s reluctance to recognise MASEU as a union stems from the new MAS Act which is at odds with the Employment Act 1955.

It was reported that MAS has an existing workforce of 20,000, of which some 6,000 to 8,000 are expected to be laid off by Khazanah as part of its RM6 billion (S$2.23 billion) restructuring plan.

There are at least nine workers unions and associations in MAS. Apart from MASEU, others include the National Union of Flight Attendants Malaysia, which represents about 1,500 cabin crew members, Malaysia Airlines Employees Union Peninsular Malaysia and the Malaysia Airlines Pilot Association.

Mr Jabarullah said staff will probably receive two letters – the first one for termination of their services with MAS and the second, either an offer to join MAS Bhd or to report to the Corporate Development Centre, set up to retrain the sacked workers.

Meanwhile, a MAS engineer identified as Mr Shukri said that with the dissolution of MASEU, he and others are worried whether the welfare of workers will be protected in the new company.

“It seems that the union can’t do anything, they’re going to have to be dissolved.

“With MAS gone, automatically the union will be finished. Most likely the new company might not have any union at all,” he said.

Meanwhile, Malaysian Trade Union Congress secretary-general N Gopal Kishnam said MASEU should not take such a drastic measure. “It is not proper, why do they want to dissolve the union. They should continue to fight for the workers’ rights?” he said.

This came after Khazanah unveiled a 12-point plan to enable MAS to achieve sustained profitability within three years of de-listing, by the end of 2017.

Its managing director Azman Mokhtar said the plan involved a comprehensive overhaul of the airline and has four categories which are governance and financial framework, operating business model, leadership and human capital, and regulatory and enabling environment. THE MALAYSIAN INSIDER- Today Online, 28/5/2015

Tuesday, May 26, 2015

MAS's Independent Administrator finally appointed - not to prepare proposal but to 'sign termination letters'?

Who are the one making the plans for Malaysian Airlines? Should it not have been the INDEPENDENT Administrator that prepares the proposals.... which then is considered by the INDEPENDENT Adviser - This proposal is then submitted to be approved or not...well that, I believe, was the check and balance provided by the Malaysian Airline System Bhd (Administration) Act 2015.

25/5/2015 - The Administrator is appointed...
Khazanah Nasional Bhd, the sole shareholder of Malaysia Airlines (MAS), has appointed Datuk Mohammad Faiz Azmi as Administrator for the airline, effective today. - NST, 25/5/2015
And it looks like he has been appointed just in time to 'sign the letters of termination of employees' which is coming up a few days time, the end of the month.

Today, an administrator will be appointed. He is Datuk Mohammad Faiz Azmi, executive chairman of the consulting and audit firm PricewaterhouseCoopers. He will sign all the termination letters, which will be sent out on Wednesday.

Odd that even the Malaysian Airline Berhad (MAB) has apparently already entered into NEW agreements with the caterers before the appointment of the Independent Administrator >  see earlier post:- Malaysian Airlines something amiss? - where is the Independent Administrator?Independent Advisor? MAB?

So, it looks like the present MAS Board is the one that has come out with the proposal to save MAS? Odd - for the MAS Act suggested that he would have been the one re-negotiating contracts and preparing proposals... 
17  Administrator may re-negotiate contracts or prepare proposal or both
(1) The Administrator may, in the administration of the Administered Companies, at his sole discretion, take any one or both of the following actions:

(a) re-negotiate the terms and conditions of any contracts or agreements of the Administered Companies with the counterparties;
(b) prepare a proposal with respect to the Administered Companies or any claims and liabilities against or of the Administered Companies.
But alas, alas the appointment just happened - would the Administrator be able to even peruse the proposal - or determine whether employees need to terminated or the number that need to be re-hired. Would he even have time to consider make an Independent proposal for the lay off or termination benefit that ALL employees of MAS will be paid. Note that those who will be re-hired will most likely be re-employed by a new company, Malaysia Airports Berhad(MAB).

Should there not be at the very least a Parliamentary Select Committee (or some Parliamentary Committee) monitoring matters since our money is being used to SAVE Malaysian Airlines? Now, it seems that it is the MAS Board and maybe the shareholders that is making all decisions.

Khazanah appoints administrator for MAS

25 May 2015 @ 3:42 PM

KUALA LUMPUR: Khazanah Nasional Bhd, the sole shareholder of Malaysia Airlines (MAS), has appointed Datuk Mohammad Faiz Azmi as Administrator for the airline, effective today.

The appointment of the administrator will facilitate the transfer of selected assets and liabilities from MAS to the new company, Malaysia Airlines Bhd (MAB), effectively by Sept 1,2015, said Khazanah in a statement.

MAS would continues to operate throughout the period up to and including Aug 31 2015, after which MAB will operate the business of the airline from Sept 1, 2015 onwards, it said.

The appointment is a voluntary undertaking by Khazanah and is made pursuant to the Malaysian Airline System Bhd (Administration) Act 2015 (MAS Act), which was passed by both houses of Parliament last year.

The MAS Act provides for an effective, efficient and seamless means for the transition of the business, property, rights, liabilities and affairs of MAS to MAB.

The transition from MAS to MAB is a key component of the 12-point MAS Recovery Plan (MRP), which was announced on Aug 29, 2014, to restructure the national carrier and set it on a path towards sustainable profitability.

The MRP also includes conditional investment funding by Khazanah of up to RM6 billion, disbursed on a staggered basis and subject to the fulfillment of strict conditions. – Bernama

Read More :

It will either be tears of joy or anguish for 20,000 MAS employees

by b.k sidhu, neville spykerman, rahimy rahim, michelle tam, AND tashny sukumaran 

PETALING JAYA: Anxiety is at its highest and morale lowest for the 20,000 people working for the national airline. It will either be tears of joy or anguish when they get their termination and re-employment letters in a matter of days. 

Malaysia Airlines (MAS), one of the country’s biggest government-linked companies, will terminate its entire workforce to start afresh as a smaller airline with a regional focus rather than international.

The only person spared is chief executive Christoph Mueller, who was hired to lead the new airline but was then roped in to manage the transition.

No GLC in Malaysia has ever sacked nearly everyone and this could well be the most number of people ever sacked in one day in Malaysia. 

But this is part of the last-ditch effort to remake MAS, saddled with debts for several years now, even before the twin tragedies of MH370 and MH17.

Today, an administrator will be appointed. He is Datuk Mohammad Faiz Azmi, executive chairman of the consulting and audit firm PricewaterhouseCoopers. He will sign all the termination letters, which will be sent out on Wednesday.
Said one MAS staffer: “I thought a GLC was the safest place to work in, but now I don’t even know if I will have a job on June 1.” 

The staffer, who did not want to be named, said: “It is a very sad period in our lives. I never thought this day would come when I first joined the airline more than two decades ago. 

“I cannot even think about how I am going to pay for my house and car loans.’’

The termination is aimed at easing the migration of MAS into a new company, MAS Bhd, which will begin operations on Sept 1. 

The appointment of administrator marks the beginning of the eventual end for MAS as an entity as Faiz’s job will be to clean up MAS for closure and transfer all the assets and liabilities to MAS Bhd, as provided for in the MAS Act 2015. 

About two-thirds of the 20,000 staff will be offered jobs with new conditions.

It was reported earlier that 6,000 staff would be axed but sources now say that in effect, it is that 6,000 roles that could be cut and some of those roles could be done by more than one staff. 

So sources say the final number of staff asked to go could be over 8,000, but in stages over a year.

“The 6,000 will be terminated at the same time, but some will be released in phases to manage the transition.
“Some will be offered short-term contracts in MAS Bhd,’’ said a source.

Staff can expect to get two letters – one for termination of their services with MAS and the other either an offer to join MAS Bhd or an invitation to report to the Corporate Development Centre (CDC), which has been set up to retrain axed workers. 

“No jobs are safe but some people obviously are,” said one staff. 

He hoped the existing management team would not be rehired to manage the new MAS but sources dashed that hope. 

They say the long blades may not come out for the senior management, as Mueller needs a proper transition.

It’s not quite Mueller’s style, going by his own words. In an interview with Cambridge University business school last year, Mueller said the first year of a restructuring was like going to war and it was “difficult to create a winning team from an existing management team in a turnaround”.

Whatever his strategy, Mueller is busy working out a tough business plan for the new airline. Even the 3,779 supply contracts are being redone under new terms, including the controversial catering with Brahim’s Holding Bhd, now changed to a shorter term with prices slashed by a quarter. 

A large number will have to leave immediately but will receive their salary and benefits only at the end of August. 

The CDC will open on June 1 to offer free outplacement and training services for staff.

This week CDC has set up kiosks at MAS premises, particularly at cafeterias, but this has not gone down well with the staff.

“They are insensitive. Even before we get letters they are already doing this. I cannot even have a decent meal now,” said an employee.

Those axed will be paid compensation, but the amount may not be as much as under the collective agreement (CA).

Even those rehired by MAS Bhd will get some money in the form of a sign-on bonus, but the formula is not known.

A source said that given the financial state that MAS is in, it will not be able to offer the payout formula as stated in the various collective agreements – one month for every completed year of services and one month and a half for those above 10 years.

The source said the selection of staff to be rehired would be based on performance. 

“MAS will know how many of those offered will take up the new offer to join the new airline by June 12. 

“It should have a contingency plan in place if the numbers don’t match what they expect. 

“In any case, pilots and crew are in demand as several airlines, including Korean Airlines and Qatar Airways, recently conducted roadshows to lure MAS crew,’’ said a source.

Managing the fallout is going to be MAS’ biggest test because there will be staff who will be disgruntled after getting their letters.

“But safety and security remain MAS’ top priority,” the source added.

MAS has also roped in all members of its management team to be counsellors and more will be trained this week to talk to the staff, especially those who will be axed. 

Chronology of MAS
Oct 12, 1937: Malayan Airways Limited (MAL) was born.
April 2, 1947: MAL took to the skies with its first commercial flight as the national airline.
1963: With the formation of Malaysia, the airline changed its name to Malaysian Airlines Limited.
1965: With the separation of Singapore from Malaysia, MAL became a bi-national airline and was renamed Malaysia-Singapore Airlines (MSA).
1972: Malaysia and Singapore went their separate ways. Malaysia introduced Malaysian Airline Limited, which was subsequently renamed Malaysian Airline System and branded as Malaysia Airlines.
September 2011: Ahmad Jauhari Yahya was appointed as the new Chief Executive Officer after a major restructuring to the Board of the Company.
Feb 1, 2013: Malaysia Airlines became a full-fledged member of oneworld alliance, connected to some 850 destinations in 150 countries across the oneworld alliance network.
December 2013: Three-year losses ending Dec 31, 2013 amounted to RM4.1bil.
March 8, 2014: Malaysia Airlines Flight MH370 disappeared while flying from Kuala Lumpur to Beijing. The aircraft was carrying 12 Malaysian crew members and 227 passengers from 15 nations.
July 17, 2014: Malaysia Airlines Flight MH17 that was flying from Amsterdam to Kuala Lumpur crashed after being shot down in Ukraine, killing all 283 passengers and 15 crew on board.
August 2014: Khazanah National announced its intention to purchase remaining ownership from minority shareholders and de-list the airline from Malaysia's stock exchange, thereby renationalising the airline. May 1, 2015: German-born Christoph Mueller took over as Malaysia Airlines Chief Executive Officer.
May 15, 2015: It was reported that letters of employment and termination would be couriered to the workers’ residential addresses beginning May 27. - Star, 25/5/2015

Monday, May 25, 2015

Najib shifting blame to traders for post-GST price rise when really blame should lie with him and the BN government?

Najib too quick to shift blame on traders for price increase - but really, the fault should lie with the PM and the BN government.

On paper, there really should have been no price increase - in fact a drop in prices considering the fact that the old taxes that the GST replaced is at the same rate or lesser.  

"We have abolished SST of 10, five per cent, some people do not know about SST before, the problem (abolition) is, it should have reduced prices

So, why has the prices risen? Well, let us look at the factories and wholesalers/suppliers - have they reduced the prices of the products they provide the traders? Has it been reduced by 6% or more(depending on the earlier applicable taxes)? Well, if they are selling still at the old price - then should we not be taking action against them?

Second - do not forget that by this BN Government policy - business operating cost of the traders have increased. How?

Well, you needed to get the relevant machines and programs, and these cost between RM10,000 - RM15,000

Well, now NEW staff was needed to input data in this new hardware/software, make the necessary calculation, prepare GST submissions > the government totally failed to appreciate that many of the old 'traders' were computer illiterate, and did not have the capacity to be able to handle the GST and matters related. So, for a new staff(2 maybe if the operation hours were more than 8 hours) - additional RM2,000 per staff (RM4,000 if 2) monthly or will it be more?

Third - a failure to realize that many traders never paid the suppliers the full some for the products when it arrived. There were various forms of business arrangement - most common is that payment only made after product sold. But the GST fails to appreciate this - requiring the trader to  pay the 6% GST when the product arrives from the suppliers, and before it has been sold >> These traders will thus have to pay GST even before they manage to sell a product >> and now for items that arrive at the shop costing RM10,000, they have to already pay GST - RM600. This is money paid out before the items are sold. Yes - you can reclaim money paid if goods not sold later on...

End result, is that the cost of doing business for the trader, retailer have all increased - all because of GST. Many of these businesses are really small businesses ... and to compensate all this increases in cost of doing businesses, it comes as no surprise that customers end up paying...

Now, the government is going after those that have increased prices...of 'roti telur' - should not the retailer/businesses have a right to sell roti telur at whatever price they want? Try having a roti telur at some hotel or even some 'high-class restaurant' - guess what the price is so high. So, why not take action against them too.

Then let us look at how costs of houses are pushed up so unreasonably in Malaysia - no price control? No action? 

GST - well, all the government should have done was to collect it in the same was it was doing the old sales and services taxes. The whole system of forcing the end retailer/trader to calculate and pay it is where the BN government made a big fumble - and caused the people great suffering. Points of production was the best place to collect these taxes - and that value would have gone into the prices. 

So why did this BN government do this? 

GST: Thank you BN for bringing prices down by 10%? 4%? Thank you for getting rid of many 'kedai runcit'?

Sundry shops run by elderly closing because of GST? 

So, who profited? Well, in my opinion, it would be the people who were selling the hardware(computer,POS systems) and certainly the computer program? Was there copyright - requiring people to pay annually to be able to continue using the program?

It is sad, that with this government's price control efforts - focus is on the price of sale to consumer - the retailers,'traders', etc. Price control, must in fact start at the factories(or other points of origin), the middle-man, the wholesalers, the suppliers,...if not unjustly, the only business person that suffers is the person that finally sells to the ordinary consumer. 

What if the government discontinues GST... or even go back to the old system where GST is collected at the point of origin of the product, well will the government buy back the GST machines and programs? 

The whole idea of the GST and the manner in which it was implemented makes everyone suffer, and fault should lie with Najib, being the Prime Minister, and this BN government. Najib should not be blaming traders - or going after 'roti telur' sellers.

Why is the government not going after the BIG businesses - well Gardenia Bran & WheatGerm bread was selling at RM2.40, but after GST it is sold at RM2.55? [And, this price increase is not done by the retailer, I believe]

Pos Malaysia is charging GST for service charge...? 

Traders exploit GST and burden people

GOPENG: The action of some traders who exploited the Goods and Services Tax (GST) has burdened the people when the tax system was implemented last April 1, said Prime Minister Datuk Seri Najib Abdul Razak.

He said the traders should have reduced the prices after the Sales and Services Tax (SST) was abolished but they did not do so and instead took the opportunity to raise prices by six per cent using the GST as an excuse.

"The GST issue is caused by traders, these traders are evil, they are not responsible, not the government, we have other policies.

"When traders exploit the situation, the people blame the government and prime minister.

"Everyone want to step on my head even though my heart's intention is to strengthen the country's finance and people's welfare," he said when speaking in front of over 20,000 people during a working visit to the Gopeng Rural Transformation Centre (RTC) here today.

"We have abolished SST of 10, five per cent, some people do not know about SST before, the problem (abolition) is, it should have reduced prices but another six per cent is added, this is the cause.

"If want to be angry, get angry with the traders, they must be blamed because they do not have compassion to think about the people's interest," he said.

The prime minidtyer said through the GST system, the country's revenue will increase and many aid could be channeled to the people, including from the aspects of infrastructure and people's needs.

"If BR1M ( 1Malaysia People's Aid) needs to be increased, I can do so, if roads need to be increased, I can do so, if government employees want to have additional bonus and pension, it can be considered," he said, adding that the government could do these on condition there were financial sources.

Hence, Najib asked the relevant authorities to intensify enforcement and act more firmly to take errant traders to court.

"Sue them (traders), consumers please inform us their offences so that we can take action," he said.

Najib said the government had expected such kind of problems to occur when the GST was implemented in the country.

As such, he said the government took steps to raise the BR1M aid from RM650 to RM950.

He said GST related issues were expected to be settled within a period of one year.

"I will table to the people every ringgit of the country's addidtional revenue related to GDT for the public's knowledge.

The prime minister also denied allegations that the BR1M disbursement had made the recipients more lazy but said it helped to ease the burden of the low income group.

"The disbursement is not to make people lazy or addicted but if they receive BR1M, they can buy rice and their children's milk and school uniform.\

"The people need assistance and with this RM950, many things can be done if spend wisely. There is nothing wrong to give BR1M because developed countries also have such a system," he said.

Najib said the BR1M disbursement was aimed at increasing the consumers' power, which in turn profited the traders and caused the local economy to grow.

He said the government abolished the oil subsidy, namely bulk subisdy that was more favourable to the rich and the BR1M disbursement was a targeted subsidy that gave attention to the poor and needy.

"The oposition also get (BR1M), sometimes they are the first to ask, but never mind, support or not, that is another question because the government is responsible to help the people who need assistance," he said. – Bernama - The Sun Daily, 23/5/2015

Restaurant with 'roti canai telur' at RM2.50 raided

A famous 'nasi kandar' restaurant in Bukit Jambul was raided today by the Enforcement Division of the Domestic Trade, Cooperatives and Consumerism Ministry, Penang for selling 'roti canai telur' at RM2.50.
State ministry enforcement deputy head Chin Ching Chung said the inspection was carried out at 10.40am after the department received a consumer's complaint that the price of 'roti canai telur' before the implementation of the Goods and Services Tax (GST) was RM1.80.

"The restaurant operator is given three days to submit relevant documents and reasons for raising the price before enforcement action is taken," he said when contacted.

He said if the operator failed to give reasonable explanation for the price rise within the stipulated period, action could be taken under Section 21 of the Price Control and Anti-Profiteering Act 2011.

"If the operator concerned is found to make an excessive profit margin, he can be prosecuted under Section 14 of the same act," he added.

Chin said further investigation revealed that the price of 'roti canai telur' at the restaurant had been raised several times before April from RM1.80 to RM2.20 and the latest to RM2.50 after the GST.

- Bernama - Malaysiakini, 23/5/2015

Sunday, May 24, 2015

PM Najib lied about minimum wage? Honesty is always needed from Government

What? PM Najib is not telling the truth again - he says ‘We have only implemented the minimum wage policy for about a year and five months…’ (Malaysian Digest, 3/5/2015, ‘Too soon to review minimum wage’ – Najib)

Wrong PM Najib - Workers in Malaysia started enjoying Minimum Wages on 1/1/2013 - that is 2 YEARS 4 MONTHS 21 DAYS AGO 

Implementation of Minimum Wage Policy by this BN Government starts on about 2010 - when the government started steps to enact the necessary law - then later on 16 July 2012, we finally had our first Minimum Wage Order.

MTUC is right to say that the next Minimum Wage Order should have come out latest by 16 July 2014 - and as such, there is a long delay - about 10 Months now.

Wait - the Law would not have been followed because it says review at least once every 2 years? Since, the last review resulted in the Order of July 2012 - Can we say that the law was not followed?

See earlier post for MTUC's full statement - 

MTUC disappointed that after 2 years and 4 months, workers Minimum Wage rates still not increased

Raise minimum wage now, says MTUC

FMT Reporters
 | May 20, 2015 
The law requires a review every two years and Putrajaya has missed the deadline.


KUALA LUMPUR: The Malaysian Trades Union Congress (MTUC) has demanded an immediate review of the minimum wage rates, pointing out that Putrajaya has missed the legal deadline to do so.

The last Minimum Wages Order was issued in July 2012 and a new order should have been out by July 2014 to take effect from January 1, 2015, MTUC Secretary-General N Gopal Kishnam said in a press statement.

“There should be no exemption for any employer, and all workers, including migrant workers, should be treated equally without discrimination,” he said.

The current minimum wage for Peninsular Malaysia is RM900 per month. For Sabah and Sarawak, it is RM800. MTUC is calling for a new rate of at least RM1,200.

The National Wage Consultation Council Act 2011 states that the council shall “at least once in every two years review the Minimum Wages Order”.

“It is May 2015 now and the minimum wage has not been raised,” said Gopal Kishnam.

“The cost of living over the last few years has increased drastically by the removal of subsidies and now the introduction of the Goods and Services Tax (GST).”

He said it was unacceptable for Prime Minister Najib Tun Razak to say at the National Labour Day celebrations in Kuching that the “minimum wage could not be increased now”.

MTUC also voiced its concern over foreign workers who are not being paid the existing minimum wage by certain employers. - FMT, 20/5/2015

Thursday, May 21, 2015

MTUC disappointed that after 2 years and 4 months, workers Minimum Wage rates still not increased

MTUC disappointed that after 2 years and 4 months, workers Minimum Wage rates still not increased 
19 May 2015

Malaysian Trade Union Congress (MTUC) is disappointed that Malaysia will still not increase the Minimum Wage now in May 2015, noting that cost of living over last years have increased drastically by, amongst other reasons, the removal of subsidies and the introduction of the Goods and Services Tax (GST).

It was reported that Prime Minister Datuk Seri Najib Tun Razak at the at the government’s Labour Day celebrations at the Borneo Convention Centre Kuching on 1/5/2015 ‘said minimum wage could not be increased now’ (Star, 2/5/2015, 11MP to focus on human resources development, says PM). This is unacceptable because it is unjust that workers in Malaysia are required to enjoy same rate of Minimum Wages for more than 2 years and 4 months.

National Wage Consultation Council Act 2011 in Section 25(1) clearly state that, “The Council shall, at least once in every two years, review the Minimum Wages Order”, and this certainly includes the Minimum Wage Rates. Two years is the statutory maximum period before which Minimum Wage rates should be increased, and the law is clear that Minimum Wages could be reviewed and increased even at a faster rate depending the effectiveness of current rates having due regard to also the socio-economic reality of workers and their families. Clearly, the cost of living has escalated since the last Minimum Wage Order in 2012 was made, and this should have reasonably led to increases in the Minimum Wage rates.

It must be pointed out that the last Minimum Wages Order 2012 (P.U. (A) 214) was made on 16 July 2012, and since then it has been almost 2 years and 10 months – as such the next Minimum Wage Order which really should have been made on or before 16th July 2014 is long overdue. Workers in Malaysia should have been enjoying higher Minimum Wage Rates at the very least since the beginning of the year – 1st January 2015.

MTUC notes that the Malaysian government has effectively denied many workers the full enjoyment of their right to Minimum Wages as of 1st January 2013 by reason of the various exemptions provided to certain employers or classes of employers. MTUC also reiterates its protest on that discriminatory nature of Minimum Wages (Amendment) Order 2013 which created a situation where migrant workers in certain workplaces were denied Minimum Wages for a certain period when their fellow local workers already enjoyed this right to Minimum Wages.

Prime Minister Datuk Seri Najib Tun Razak was clearly wrong when he said that, ‘We have only implemented the minimum wage policy for about a year and five months…’ (Malaysian Digest, 3/5/2015, ‘Too soon to review minimum wage’ – Najib), because the relevant Minimum Wage Order was made in July 2012, whereby workers in Malaysia started enjoying minimum wages on 1 January 2013 – and it has been more than 2 years and 4 months since workers started enjoying a Minimum Wage of RM900 (Peninsular Malaysia) and RM800 (for Sabah and Sarawak). MTUC was also unhappy about this discrimination against workers in Sabah and Sarawak, considering also that the cost of living in East Malaysia is higher than in Peninsular Malaysia, a fact that is also reflected in the official poverty line income.

MTUC calls on the Malaysian government to immediately increase Minimum Wage rates to at least RM1,200, and this entitlement should be made effective as of 1st January 2015. Employers should be compelled to immediately pay all monies due to the worker by reason of the increased Minimum Wage from the beginning of the year until the relevant date. There should be no exemption for any employer, and all workers, including migrant workers, in Malaysia should be treated equally without discrimination.

N. Gopal Kishnam Secretary General
Tel: + 6 019 317 4717

Source: MTUC Website

Wednesday, May 20, 2015

More than 5 years - workers in RENESAS still struggling for their Union Rights?

The right to form and belong to a Trade Union is a fundamental right of workers. Why Trade Union? Well, collectively workers are stronger and are in a better position to deal with their employer, and obtain better worker rights - something that is very difficult if workers alone or in small groups try to achieve through negotiations with employers.

The right is there but access to that right in Malaysia is very difficult.

First, there is a need for REGISTRATION,

And, thereafter there is another requirement before a Trade Union can start to negotiate and enter into Collective Bargaining Agreements with their employer...The Union needs to get the RECOGNITION of their employer.

The Union applies to the employer for RECOGNITION - and good employers can easily accord recognition, but alas many an employer will try to deny recognition using a variety of reasons... This denial of recognition happens even if the majority of the workplace are already members of the said Union? Absurd and most unreasonable...

And if the employer refuses to accord recognition, the Union brings the matter to the relevant government authority - who then will proceed to have a SECRET BALLOT - which will involve all employees of the workplace who would qualify as member of the said Union. Again, bad employers can delay matters by being uncooperative ...and make even the process of working out the list of employees qualified to vote a prolonged exercise.

The longer the employer delays the process, the better for the Employer because many qualified employees may be no more workers because they were employees under precarious short term contracts - and this includes migrant workers. The list of qualified employees entitled to vote is as it was on the first date of the Union's application for recognition... and that can sometimes be many years ago...

In any event, then we have the SECRET BALLOT - and all qualified employees are entitled to vote. But, alas 'tricks' and 'threats' may be used to prevent qualified voters coming out to cast their votes. In most elections, what matters is only ballots in the box - but unjustly this is not the case when it comes to this 'Secret Ballot' - qualified voters who did not turn up to cast their ballots are considered to be persons who voted against UNION - in favour of employees. To succeed, the Union needs to get more that 50% of all qualified employees to come and cast the vote in favour of the UNION - and this is not an easy task.

Now, even if the Union  succeeds at the Secret Ballot and get the required number of votes, and the Minister orders that RECOGNITION is accorded - some 'bad' employers of late have been going for Judicial Review at the High Court to challenge the outcome of the secret ballot and/or the decision of the Minister to accord RECOGNITION. When they do this, they also go for an interim order to prevent Unions exercising their rights that come with Recognition, which is primarily proceeding with the Collective Bargaining Agreement. This again denies Unions and workers at the said place their full rights as Union - and this delay can go on for months and years...Remember, even if the High Court rejects the employer's application, the employer can further delay matters through appeals to the Court of Appeal, and thereafter to the Federal Court. 

At the end of the day, the Trade Union rights are just denied Malaysian workers. With the changes happening to employment relationships - where employees now are losing rights to regular employment until retirement - and more and more employees are being employed as precarious short-term contract employees or labour requirements are being met not by hiring employees but getting workers(non-employees) from third party labour suppliers(in Malaysia, now known as 'contractors for labour'). Now these supplied workers are not considered employees - and they will not be able to benefit from a Collective Bargaining Agreement, being an agreement that only benefits employee members of the trade union and the employer. 

Employers are also resorting to dismissal of union leaders as a means to 'bust' unions - It may be wrongful dismissal, but the entire process to access justice and reinstatement just takes a very long time - and even, after the courts determine that a worker is wrongfully dismissed, the courts may order the alternate remedy of 'compensation in lieu of reinstatement' - and Malaysia, now has limited this to not more than 24 months back wages/benefits. The courts consider 'industrial harmony' - and likelihood of reinstatement becomes slimmer.

Hence, it is not at all surprising that the number of unionised workers in Malaysia is not rising over the past few years. It is not surprising that less than 5% of workers in the private sector are unionised. Workers in the public sector and of statutory bodies are less affected by such denial of rights. But then, the problem is that Malaysia is now more inclined towards privatization - and they too will find themselves in the same precarious position as private sector unions and workers sooner rather than later.

One example of note is the case of the The Electronic Industry Employees Union Western Region, Peninsular Malaysia (EIEUWR)/ Kesatuan Sekerja Industri Elektronik Wilayah Barat Semenjung  Malaysia(KSIEWBSM) and its struggle at RENESAS Semiconductor KL Sdn Bhd (formerly known as NEC Semiconductors (Malaysia) Sdn Bhd]

Now, here the first application for RECOGNITION was sent on January 2010. When the first application was sent, about 70%(or 1,300) of the qualified members in RENESAS were already members of the Union. Thereafter, several applications had to be send. See the following posts for more details:- 



In any event, finally there was the SECRET BALLOT, which the Union was successful - getting 72% votes...
The Electronic Industry Employees Union Western Region, Peninsular Malaysia (EIEUWR)/ Kesatuan Sekerja Industri Elektronik Wilayah Barat Semenjung  Malaysia(KSIEWBSM) was victorious in the 'secret ballot' when about 72% of the qualified workers at RENESAS Semiconductor KL Sdn Bhd (formerly known as NEC Semiconductors (Malaysia) Sdn Bhd]voted in favour of the Union.

72% of RENESAS workers vote in favour of UNION - finally recognition after almost 4 year struggle

At last, secret ballot being conducted at RENESAS - UNION or NO UNION?

But, then the employer has applied for Judicial Review further delaying the rights that comes with RECOGNITION - and this case just recently came up for Judicial Review on 19/5/2015, and have now been adjourned to 25 June 2015