‘Minimum wage has little impact on major restaurants’

KOTA KINABALU: Major restaurants will not be impacted much by the implementation of the minimum wage policy as it was a matter of restructuring the service charge into employees’ wages.

President of Sabah Restaurants Fellowship Association Kapitan Lim Vun Chan said restaurants which include service charge could use part of their service charges to restructure their employees’ wages to make it up to RM 800.

However, Lim said some restaurants omit service charges to attract customers with cheaper prices.

When the minimum wage was announced, these restaurants which did not include service charges found themselves without the money to restructure the wages, he said.

“Smaller restaurants could charge three, four to five per cent, but they did not do so and now they find that they have no money to restructure the wages.”

The implementation of the minimum wage would also impact coffee shops that did not charge for their services, Lim pointed out.

Lim advised restaurants to include service charge in their bills as it would lessen the impact of minimum wage.
There are around 100 members registered under Sabah Restaurants Fellowship Association.

Lim, who is also the chief executive officer of Port View Seafood Village Sdn Bhd, said the restaurant would not raise the price of its food at the moment.

However, he explained that there are other industries that could not restructure their employees’ wages using service charge, thus these industries would have to increase the price of their products and services.

In three to five months, Lim said the price of products would increase due to increase in cost of raw materials.

It is a chain reaction that is inevitable, he said.

Currently Port View Seafood Village Sdn Bhd employs around 100 workers and the implementation of minimum wage would translate to a few more thousand ringgit of expenses a month, he said.