Malaysian fast-food restaurants face foreign worker ban

Jennifer Pak reports on how Malaysia's fast-food firms will cope with a new labour law.

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Inside a shopping mall built like an Egyptian pyramid in Malaysia's Selangor state, Durga Dasadursarumagar cleans tables at the US burger chain restaurant Carl's Jr.

As a Nepalese, he works four hours longer than his Malaysian colleagues and for less pay.

But that doesn't bother him because even on a salary of 800 Malaysian ringgit ($245; £150) per month, Mr Durga makes five times more money than he would earn back home in Nepal.

"It's a very easy job," says the 23-year-old.

But once Mr Durga's visa expires, he won't be able to renew his contract as the Malaysian government has banned fast-food restaurants from hiring more foreigners.

That is because, according to the cabinet committee on foreign workers and illegal immigrants, many locals are keen to take up such jobs.

Frustration

Start Quote

Bob Ali

It's tough to find Malaysians who want to work here”

End Quote Bob Ali Carl's Jr Malaysia

It's part of Malaysia's bid to reverse decades of dependence on cheap labour.

Despite government efforts in recent years to make it more difficult and expensive to hire foreigners, at least one in six workers in Malaysia is a low-skilled immigrant.

That has led to frustration among some Malaysians over the number of foreigners working in the country.

Foreigners make up nearly 20% of the workforce at Carl's Jr in Malaysia, and account for 5% of the 12,000 staff who work for McDonald's in the country.

Immigrants employed in the fast-food sector mainly perform jobs such as cleaning, while locals run the cash tills and cook.

But the operations director for Carl's Jr Malaysia, Bob Ali, doesn't agree with the latest move.

A sign outside Carl's Jr in Malaysia Fast-food chains have been looking to hire more local staff

"It's tough to find Malaysians who want to work here," says Mr Ali.

"We will survive, but it will still affect our service where it will be a little bit slow and it'll affect sales as well."

A big, black sign that reads: "We are hiring!" has already been a permanent fixture at the entrance of the restaurant for more than a year.

But it rarely draws Malaysians in to inquire about a job. So when Mr Ali sees students in his restaurant, he serves them burgers and offers them a part-time job as a side order.

'Detrimental'

Start Quote

Some of these jobs need social and language skills but we haven't trained Malaysians”

End Quote Ramon Navaratnam Economist

Across this country of 29 million people, there are two million legal foreigners from poorer countries such as Indonesia, Nepal and Bangladesh eager to take up the jobs that Malaysians shun.

Hundreds of thousands more risk being jailed after coming to work in the country illegally.

They are instrumental in running popular roadside food stalls, constructing luxury condominiums, building roads and preparing plantation harvests for export.

Economists credit these low-skilled workers with helping Malaysia move from being a backwater country dependent on tin and rubber to a trading nation.

Yet the government's 2013-14 economic report states that "over-reliance on foreign workers can have detrimental consequences" and "will not encourage local companies to automate, which is necessary to drive the economy to higher productivity levels".

Lagging behind

Economist Ramon Navaratnam, who used to work in the Malaysian treasury, says that to achieve higher productivity, the government has to provide proper training.

"Some of these jobs need social and language skills but we haven't trained Malaysians," he says.

A fast food outlet in Malaysia Businesses say the move is likely to hurt their service and profits

Poor English language skill among Malaysian graduates continues to be one of the top complaints among business leaders.

Although nearly every child in Malaysia goes to school, the World Bank says "quality remains a concern".

Malaysia's secondary school students lagged behind those in lower-income countries such as Vietnam in the 2012 Programme for International Student Assessment (Pisa), which compares maths, reading and science skills worldwide.

However, the World Bank believes that proposed changes in the country's education system, such as providing incentives to hire more qualified teachers, will prepare students to be more innovative and entrepreneurial.

Fast learners

Economists like Mr Ramon also blame employers for "undercutting the market" by keeping wages well below the urban poverty line.

He believes that having better-trained graduates would also force restaurants to pay more to hire locals.

Nor Asini binti Mamat Nor Asini says young Malaysians prefer working in cosy places

But Carl's Jr Malaysia's restaurant manager Nor Asini binti Mamat says their recruitment woes lie in the local work ethic.

Many Malaysians quit after a few days of work, she says.

"Sometimes they have a personal problem and cannot continue but other times they say they are tired or not interested and just resign," says Ms Nor Asini, adding that her niece and nephew did the same.

"Nowadays they want to work easier, earn more money and work in a cosy place," she says.

In contrast, immigrants are willing to work 12-hour shifts and are fast learners.

So while the government is looking to curb the influx of foreign workers in the sector, industry players remain worried about whether they will be able to find adequate local staff to keep their operations running smoothly.

Unlike the food they serve, the solution may not be a quick fix.

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