wage transformation through productivity-linked wage system (plws)

Wage Transformation ThroughProductivity-Linked Wage System

(PLWS)

Sugumar SaminathanManager,Malaysia Productivity CorporationTel: +603-79557266 ext 544,DL: +603-79562566,Mobile:+6019-6354078E-mail:[email protected]:http//www.mpc.gov.myMinistry of International Trade and Industry (MITI)

Transformation • Innovation • Partnership2


PRODUCTIVITI

BUSINESSMAN:“Productivity is

reducing cost and increase profits.”

WORKFORCE:

“Productivity

means getting

higher wages,

benefits and

better working

conditions and

environment.”

CONSUMER:“Productivity bring good

quality products and services at cheaper

prices and higher living standards.”

Transformation • Innovation • Partnership

WHAT IS PRODUCTIVITY?

Productivity =

Output

Input

Output : Goods & Services

Input : Resources Used

9

5 WAYS OF IMPROVING PRODUCTIVITY?

5 Ways Firm Approach

O

I

O

I

O

I

O

I

O

I

Reduce Cost

Manage Growth

Work Effectively

Work Smarter

Pare Down

Productivity is a measure of efficiency in the use of inputs or

resources in relation to its outputs

Output

●Gross Domestic Product (GDP),● Total Output, ● Added Value,● Monetary Value of Production,● Quantity of physical unit produced

Output

●Gross Domestic Product (GDP),● Total Output, ● Added Value,● Monetary Value of Production,● Quantity of physical unit produced

Input

● Employees,● Total man-hours worked● Labour cost, ● Capital/Fixed assets, ● Energy, ● Material, ● Services

Input

● Employees,● Total man-hours worked● Labour cost, ● Capital/Fixed assets, ● Energy, ● Material, ● Services


PRODUCTIVITY IS VALUE CREATION

Product Innovation

10

Create/Add Value

IS YOUR COMPANY CREATING VALUE?

i-COMPASS

i-COMPASS is a self learning application tool that help companies to compute the wealth company created by its own and employees efforts


WORK SMART = HIGHER PRODUCTIVITY

Work environment

Plant & EquipmentPeople


CONTENTS LABOUR COMPETITIVENESSLABOUR COMPETITIVENESS


ADDED VALUE PER EMPLOYEE Indicates the added value genarated by an employee. A high value indicates high productivity of an employee

TOTAL SALES PER EMPLOYEE Indicates the total sales genarated by an employee. A high value indicates high productivity of an employee

TOTAL OUTPUT PER EMPLOYEESS Indicates the total sales genarated by an employee. A high value indicates high productivity of an employee

TOTAL OUTPUT PER MAN HOURS Indicates the total output genarated by an employee

per hour. A high value indicates high productivity of an employee

LABOUR PRODUCTIVITYLABOUR PRODUCTIVITY

13


ADDED VALUE PER LABOUR COSTEE Indicates how competitive the company is in terms of

Labour Cost. A low ratio indicates high Labour Cost

LABOUR COST PER EMPLOYEE Indicates the average remuneration per employee A high value means high returns to individual workers

and vice-versa.

UNIT LABOUR COST Show the proportion of Labour Cost to Total Output A high ratio indicates high Labour Cost

TOTAL OUTPUT PER LABOUR COST Indicates how competitive the company is in terms of

Labour Cost. A low ratio indicates high Labour Cost

LABOUR COMPETITIVENESSLABOUR COMPETITIVENESS

14


CONTENTS PRODUCTIVITY AND QUALITY ENHNACEMENT PROGRAMME

PRODUCTIVITY AND QUALITY ENHNACEMENT PROGRAMME


Lean Management System

Type of

Lean

Lean Government

Lean Service

Lean Manufacturing

• VSM• Poke-Yoke• TPM• Kanban• 5S• SMED

• Transformation

• Creativity• Innovation• Wastages• Matlamat

Organisasi

Continues Implementation

&Impact


‘Famous’ 7+1 types of wastages


PRODUCTIVITY : WEALTH CREATION AND SHARING

Baking & sharing a bigger economic cake

PRODUCTIVITY -LINKED WAGE SYSTEM


Why Do We Need To Restructure Our Wages?

• A flexible and competitive wage system will enable companies to make quick adjustment to wages that will ensure job stability and reduces the likelihood of retrenchment in the event of an economic slowdown.


What Is Wage Restructuring

•Wage restructuring is about making wages more flexible and competitive.

•In good times, employees can look forward for bigger bonuses and better incentives when both company and employees performance well.

• In bad times, employees will have greater jobsecurity as company can make quick adjustmenton wages to avoid retrenchment.

Transformation • Innovation • Partnership 2323Transformation, Innovation & Partnership

For flexible and competitive wage system that ensure job stability and reduces

retrenchment in the event of an economic slowdown.

“PLWS The Way Forward”

Transformation • Innovation • Partnership 2424Transformation, Innovation & Partnership

When Do Company Implement PLWS?

• PLWS should be implement when the companywant to enhance its competitiveness and improve productivity.

• The company want to reward good employees and motivate average employees.

• The company want create harmonious labour relation and create win-win situation.

Productivity-Linked Wage System

25


PRODUCTIVITY- LINKED WAGE SYSTEM (PLWS)


Malaysia’s Policies on Linking Wages To Productivity


PHASE 1Creating Conducive Environment

PHASE 2Establishing PLWS System

PHASE 3Implementing PLWS System

MPC PLWS MODELMPC PLWS MODEL

Start

1. Create awareness on PLWS among management

team

2. Measure company’s performance

3. Develop PLWS Committee

4. Developing Corporate, Division & Unit KPI

5. Briefing Session with Company’s Workers

6. Obtain feedback from employees and management

8. Establishing PLWS on a trial basis

9. Review and make the necessary adjustments

10. Implement PLWS at the

firm level7. Linking Incentives with Improvement

11. Plan (continuous Improvement)

PHASES IN IMPLEMENTING PLWS

Transformation • Innovation • Partnership 2929

COMPONENTS OF PLWS

BASIC WAGE

FIXED COMPONENTS

Wage increase for the year based on:-

Productivity, orProfit sharing formula

VARIABLE COMPONENTS

There must always be the fixed and the variable component in

the PLWS

ANNUAL INCREAMENT


PLWS Model 1:

Profitability Model

• Payment of bonus according to profit levels based on monthly basic pay.

• Payment of bonus according to profit levels based on monthly basic pay.

Profit After Tax(RM Million)

Bonus[Month(s)Salary]

<1.5 (threshold) 0

1.5 - 1.99 0.5

2.0 - 2.49 1.0

2.5 - 2.99 1.5

3.0 and above 2.0


PLWS Model 1:

Profitability Model

• Bonus payments paid in quantum (RM)

• Bonus payments paid in quantum (RM)

Profit Before Tax(RM Million)

Bonus(RM)

<5 (threshold) 0

5 - 7 500

7 - 9 1,000

9 - 11 1,500

11 and above 2,000


PLWS Model 2:

Productivity Model

• Bonus paid out at the end of the financial year based on saleable output.

• Bonus paid out at the end of the financial year based on saleable output.

Production Volume (000 m2) (Saleable Output

<5,500 <5,600 <5,750 <6,000 <6,250 <6,500

Bonus (Months)

0 0.25 0.75 1.25 1.75 2.00


PLWS Model 2:

Productivity Model

• Incentives given based on the productivity targets achieved (Individual).

• Incentives given based on the productivity targets achieved (Individual).

Planned Target Actual Achievements Incentive (RM)

80% Above 100% 150

80% 91 – 100% 100

80% 80% - 90% 50

80% Below 80% 0


PLWS Model 2:

Productivity Model

• Incentive given base on identified monthly productivity indicators and linked to the team incentives (Team).

• Incentive given base on identified monthly productivity indicators and linked to the team incentives (Team).Performance

CriteriaPerformance

Standard(Target)

1. Production targets Above 80%

2. Quality output Above 90%

3. Customer complaint

Zero complaint

4. Maintenance No machine breakdown

5. Discipline No reminder or warning letter

No. ofCriteria

Achieved

Incentives(RM)

5 100

4 80

3 60

2 0

1 0

• If team of 5 employees able to achieves all 5 criteria RM100/ team member

• If team achieves only 2 criteria No incentives


PLWS Model 3:

Combine Model

• Payment of bonus according to 2 criteria – Company Performance and Employee Performance Rating

• Payment of bonus according to 2 criteria – Company Performance and Employee Performance Rating

Operating Profits (RM Million)

Variable Productivity payment (Months)

Above 5.00 1.00 1.00 1.25 1.50 1.75 2.00

4.00 – 5.00 0.75 0.75 1.00 1.25 1.50 1.75

3.00 – 4.00 0.5 0.5 0.75 1.00 1.25 1.50

2.00 – 3.00 0.25 0.25 0.5 0.75 1.00 1.25

Below 1.00 0 0 0.25 0.5 0.75 1.00

Employee Performance Rating (%)

<40 40 - 49 50 - 59 60 - 69 70 - 79 >80

3636

PPLWS AND ITS LWS AND ITS IIMPACTMPACT

Companies with PLWS Elements in Companies with PLWS Elements in Collective AgreementsCollective Agreements

2001 ~ 20042001 ~ 2004 2005 ~ 20082005 ~ 2008

691691 1,5661,566

Impact of PLWS Implementation Impact of PLWS Implementation 2006 (%)2006 (%) 2008 (%)2008 (%)

ProductivityProductivity 2.642.64 5.175.17

Staff TurnoverStaff Turnover 5.215.21 2.132.13

AbsenteeismAbsenteeism 8.808.80 4.174.17

Rejects and ReworksRejects and Reworks 5.335.33 2.852.85


INDUSTRIAL RELATIONS INDUSTRIAL RELATIONS (AMENDMENT) ACT 2007(AMENDMENT) ACT 2007

3737Transformation • Innovation • Partnership

3838

Section 13: Collective Section 13: Collective Bargaining Bargaining

(2A)(2A) A proposal for a collective agreementA proposal for a collective agreement

may provide for one or more of the may provide for one or more of the

following:following:

(a) (a) provision for training to enhance provision for training to enhance skills skills and knowledge of the workmen;and knowledge of the workmen;

(b)(b) provision for an annual review of provision for an annual review of the the wage system; and wage system; and

(c)(c) provision for a performance-basedprovision for a performance-based

remuneration system.remuneration system.



PLWS in Collective Agreement

40Transformation . Innovation . Partnership

Sector Total Number of Collective Agreement Number of CA / Percentage With PLWS

2010 2011 2012

2010 2011 2012

No. % No. % No. %

Manufacturing 195 180 147 144 73.85 129 71.67 125 86.81

Services 116 117 127 88 75.86 95 81.20 111 87.40

Agricultural 17 17 13 15 88.23 17 100.00 13 100.00

Others 2 6 9 2 100 6 100.00 7 77.78

Total 330 320 293 249 75.45 247 77.19 256 87.37

DISTRIBUTION OF COLLECTIVE AGREEMENT (CA) WITH PLWS BY SECTORS –2010- 2012

41Transformation . Innovation . Partnership

No Elements Manufacturing(125)

Services(111)

Agricultural(13)

Construction(3)

Quarry & Mining(4)

Bonus Payments

1. Contractual Bonus 88(70.4%)

51(45.9%)

1(7.7%)

1(33.3%)

2(50.0%)

2. Bonus Based on Management Discretion 37(29.6%)

31(27.9%)

2(15.4%)

1(33.3%)

2(50.0%)

3. Fixed and Additional Bonus 7(5.6%)

3(2.7%) - - -

4. Bonus Based on Profit/ Company Performance

17(13.6%)

30(27.0%)

3(23.1%)

1(33.3%) -

Annual Increment

5. Yearly Increment 115(92.0%)

106(95.5%)

5(38.5%)

2(66.7%)

2(50.0%)

6. Increment based on Merit 23(18.4%)

26(23.4%) - - 1

(25.0%)Incentives/Allowances

7. Group Target 1(0.8%) - - - -

8. Individual Target 1(0.8%) - 2

(15.4%) - -

9. Service Charge - 14(12.6%) - - -

10. Skill Allowance 5(4.00%)

7(6.3%) - - -

11. Piece Rated Incentives - - 2(15.4%) - -

12. Commitment / Attendance Incentives 59(47.2%)

11(9.9%)

3(23.1%)

1(33.3%)

1(25.0%)

13. COLA 5(4.0%)

17(15.3%) - - -

14. Cost and Time Saving Incentives - - - - -

15. Price Bonus - - 2(15.4%) - -

16. Long Service Award 9(7.2%)

21(18.9%) - - -

17. Outturn Incentives - - 6(46.2%) - -

18. Performance Allowances for Maximum Scale Employee - - - - -

19. Trip Incentives 2(1.6%)

9(8.1%) - - 1

(25.0%)

20. Quality Service Allowance 1(0.8%)

1(0.9%) - - -

21. OMO Incentives - - - -

22. Coaching/Teaching Allowance 2(1.6%)

12(10.8%) - - -

23. Productivity Payment 4(3.2%)

3(2.7%) - 1

(33.3%) -

ELEMENTS OF PLWS IN CA BY SECTORS, 2012


PLWS Examples.PLWS Examples.


Wage System

Fixed Components

Variable Components

Basic PayWage

Min. Annual Increment

Profitability ProductivityIncentives

Combined

Example 1:Incentive Based on Performance and Productivity


Profitability

Profit sharing formula to determine “money in the pot”. The wage incentive will only be given if the profit falls within a predetermined range

Total Bonus = Profit After Tax Monthly Payroll Cost

Variable ComponentsProfitability Incentive – the profitability incentives will be pay when the profits fall within a predetermined range as shown in Diagram : Profit Sharing


Example of profitability Incentives

The bonus will be paid when the company makes certain amount of profit that falls within a predetermined range. Table : Profitability Incentives

Profits After Tax(RM Million)

Monthly Payroll Cost(RM Million)

Bonus = Profit After Tax Monthly Payroll Cost

Less than 5 5 0

5 5 1month

6 5 1.2 month

7 5 1.4 month

8 5 1.6 month

9 5 1.8 month

10 5 2.0 month


Productivity

Based on team and individual performance against predetermined productivity measurement

• Total output• Quality output• Wastages• Customer Satisfaction• Individual Performance

Productivity Incentives

The incentives will based on team and individual performance against predetermine productivity measurement.Diagram: Productivity Incentives


Matrix incentives

Matrix incentives will be given based on the profitability and average performance of division, department and individual as shown below.

Profits(RM million)

Incentives (Months)

Less 5 0 0.1 0.3 0.5

5- 7 0.1 0.3 0.5 0.7

7-9 0.2 0.5 0.7 1.0

9-11 0.3 0.7 1.0 1.3

11-13 0.4 1.0 1.5 2.0

13-15 0.5 1.5 2.0 3.0

AveragePerformance

(%)

Less 70 70 -80 80-90 90-100


If the company performance are as follows:• Division Performance is 85%• Department Performance is 90%• Individual Performance is 85%• Average Performance of an employee is 86.7%• Based on the calculation above the respective employee will

received 2 months bonus if the company makes RM 13 million profits .The incentives taking into consideration the overall employees performance. In order to received higher quantum of bonus each employees should contribute to the division and department performance as well as their own performance.


There are two components in this model, the fixed and

variable components.

The Fixed Component comprises:

•Basic Wage

The basic wage comprises the monthly wage which is based

on a salary scale with a minimum and maximum range for

each category of employee.

•Annual Increment

The annual increment is linked to the basic wage and will vary

within the scale of pay assigned to the position.


There are two types of incentives which are linked to productivity/performance:

• Bonus Based on Profit and Individual Performance • Team Incentive

Bonus Based on Profit and Individual Performance •The profit used in this model is Profit Before Tax which will be distributed to employees based on profit level and performance. The higher the firm’s profitability, the larger will be the amount available for sharing.

•Table below shows an example the matrix system of bonus payment. Based on this matrix, the amount of bonus payment received by an employee will depend on the profitability of the firm and employee performance.

Example 2. . Profit Sharing and Team IncentiveProfit Sharing and Team Incentive


Profit Sharing Incentive MatrixProfit Sharing Incentive Matrix

Profit (RM million) Variable Incentive Bonus (Months)

> 12 0 0.3 0.5 1.0 1.1 2.1

9-12 0 0.2 0.3 0.9 1.0 1.5

6-8.9 0 0.0 0.2 0.8 0.9 1.3

4-5.9 0 0.0 0.1 0.7 0.8 1.1

< 4 0 0.0 0.0 0.5 0.6 0.9

Employee Performance Rating (%)

<40 40-49 50-59 60-69 70-80 >80


Example 3. Profitability-Based Increment and Bonus

• The annual increment is based on the ROI

(Returns on Investment) while the individual

performance is based on the performance

appraisal.

• Grade A performance will receive a 6%

increment compared to 5%,4% and 3% for

Grades B, C and D respectively (as in the Table

below)


Increment Based on ROI and Individual Performance

Employee Individual Performance/Increment

ROI Achievement Grade A Grade B Grade C Grade D

Below 0% 2% or minimum RM20 whichever is higher

0% - 30% 5% 4% 3% 2%

31% - 60% 6% 5% 4% 3%

61% - 100% 7% 6% 5% 4%

Above 100% 9% 8% 7% 6%


Another aspect of this system is that the ROI achievement

also determines the quantum of bonus to be paid.

If the quantum of ROI achieved is 23% then the firm will

declare a bonus of 0.5 month basic salary.

However, if the firm achieves an ROI more than 100%

then each employee will be given a bonus of between 1.0

to 1.5 months subject to the discretion of the firm and

employee performance.


Profitability Bonus

ROI Achievement No. of Months

Below 0% 0.5 month

0% - 30% 0.6 month

31% - 60% 0.7 month

61% - 100% 0.8 month

Above 100% 1.0 months


Example 4. Bonus Based on Company and Individual Performance

The manufacturing firm in this example shall pay

performance bonus based on the company and the

individual performance.

The company performance shall be based on

achievements against business plan of the year and

employee performance shall be based on the

performance appraisal rating and points awarded in

accordance to their annual appraisal


Bonus Based on Company and Individual Performance

Company Performance Based

on Business Plan

below

85%

85% -

100%

101% -

120%

121% -

140%

Above

140%

Individual Performance Bonus Payout

Unsatisfactory below 40% 0 0.1 0.2 0.3 0.4

Average 40% - 54% 0.3 0.4 0.5 0.6 0.7

Good 55% - 69% 0.5 0.7 0.9 1.1 1.3

Very Good 70% -85% 0.7 1.0 1.3 1.6 1.9

Outstanding above 85% 1.0 1.3 1.6 1.9 2.2


If the company’s performance rating is 100% and

individual performance is 75% which is “very good”,

then the quantum of bonus that will be granted to the

employee will be 1.0 month. Therefore, this clearly

indicates that whenever both parties i.e. employees and

firm perform very well, there will be higher quantum of

bonus distributed among the employees.


Debt Collection Current 30 days 60 days 90 days

<RM100,000 2.0% 1.5% 1.0% 0.5%

RM100,000-200,000

1.0% 0.5% 0.25% 0.1%

>RM200,00 0.5% 0.25% 0.1% 0.05%

Example 5. Debt Incentive Collection


Example 6. Bonus Based on Company and Individual Performance

The manufacturing firm in this example shall pay

performance bonus based on the company and the

individual performance.

The company performance shall be based on

achievements against business plan of the year and

employee performance shall be based on the

performance appraisal rating and points awarded in

accordance with their annual appraisal.


Bonus Based on Firm and Individual Performance

Firm Performance (Profit Before Interest and Tax (PBIT)- RM million)

<5 5-10.99 11-15.99 16-20 >20

Individual Performance Bonus Months

Poor (Less than 40%) 0 0 0 0 0

Satisfactory (40-64%) 0.5 0.5 0.5 0.5 0.5

Good (65-74) 1.00 1.25 1.50 1.75 2.00

Very Good (75-85) 1.25 1.50 1.75 2.00 2.25

Excellent (85 and above) 1.50 1.75 2.00 2.25 2.50


Planned Rework Actual Acheivements Incentives (RM)*

10% of the monthly output > 11% 0

10% of the monthly output 8%-10% 10.00



10% of the monthly output 0-1% 25.00

Example 7. Rework Incentives

Incentives will be paid when there is reduction in rework rate.


Example 8: MERIT AND PROFIT SHARING SCHEMEMERIT AND PROFIT SHARING SCHEME

The Scheme consist of two components:

(a) Fixed Component which comprises of basic wage plus an annual increment of 3%of basic salary and an annual bonus of one month’s basic salary.

(b) Variable Component. Among the tools used to determine the variable component are profit sharing and personal performance review (PPR).


• Shareholder’s fund = RM 2.0 million

• Retained Earnings = 12 .5% x RM 2.0 =RM 250,000

• Profit after tax = RM 1.0m

• Amount for sharing = RM 1.0 m - RM 250,000 = RM 750,000 m

PROFIT SHARINGPROFIT SHARING


DISTRIBUTION OF PROFITSDISTRIBUTION OF PROFITS

(i) 50 per cent of profits to shared available for sharing = RM 375,000 Total Payroll RM 500,000

= 0.75 months basic salary

for each employee

(ii) 50 per cent to be distributed based on employees performance using the Personal Performance Review (PPR)


Employees PPR Score Salary (RM) Bonus Score(PPR Score X Salary)

1 70 700 49,000

2 75 800 60,000

3 80 700 56,000

4 85 900 76,500

5 80 1000 80,000

6 75 1100 82,500

7 90 950 85,500

8 95 1050 99,750

9 70 850 59,500

10 80 750 60,000

11 80 900 72,000

Total 780,750


If the company decide to allocate RM11,000 for a unit of 11 employees, based on the basic salary and Personal Performance Review Scores (PPR) as indicated, the employees will receive the following bonus points: Bonus payment = 11,000 ------------- = 0.0149

780,750

Each employee in the unit will get the following bonus payments

based on PPR scores as shown in table:


Employees Bonus Score(PPR Score X Salary)

Bonus Point Bonus Received(RM)

1 49,000 0.0149 730.00

2 60,000 0.0149 894.00

3 56,000 0.0149 834.00

4 76,500 0.0149 1,140.00

5 80,000 0.0149 1,192.00

6 82,500 0.0149 1,229.00

7 85,500 0.0149 1,274.00

8 99,750 0.0149 1,486.00

9 59,500 0.0149 887.00

10 60,000 0.0149 894.00

11 72,000 0.0149 1,073.00


Employees Profitability Bonus

(Months Bonus)

Performance Bonus(Months Bonus)

Total Bonus Received (Months Bonus)

1 RM 525 (0.75 Mths) 730 (1.04 Mths) 1,255 (1.79 Mths)

2 RM 600 (0.75 Mths) 894 (1.12 Mths) 1,494 (1.87 Mths)

3 RM 525 (0.75 Mths) 834 (1.19 Mths) 1,359 (1.94 Mths)

4 RM 675 (0.75 Mths) 1,140 (1.27 Mths) 1,815 (2.02 Mths)

5 RM 750 (0.75 Mths) 1,192 (1.19 Mths) 1,942 (1.94 Mths)

6 RM 825 (0.75 Mths) 1,229 (1.12 Mths) 2,054 (1.87 Mths)

7 RM 713 (0.75 Mths) 1,274 (1.34 Mths) 1,987 (2.09 Mths)

8 RM 787 (0.75 Mths) 1,486 (1.42 Mths) 2,273 (2.16 Mths)

9 RM 638 (0.75 Mths) 887 (1.04 Mths) 1,525 (1.79 Mths)

10 RM 563 (0.75 Mths) 894 (1.19 Mths) 1,457 (1.94 Mths)

11 RM 675 (0.75 Mths) 1,073 (1.19 Mths) 1,748 (1.94 Mths)

Total bonus paid based on profitability and performance:


Example 9:: Performance Incentives AllowancePerformance Incentives Allowance

• The company decided to reward employees which already reach their maximum salary. Employees who have reached the maximum on their salary scale and have performed commendably during the period of review, shall be eligible for a monthly allowance for the next 12 month. Performance Incentives Allowances shall include the following category of performance as shown in table below.

Performance Category Monthly Allowance

Highly Effective RM 60.00

Competence RM 40.00


Example 10: : Monthly Performance Incentives SchemeMonthly Performance Incentives Scheme

The company will pay performance incentives based on the qualifyingcriteria set by the company. Each employee must meet all the criteria tobe eligible for the incentives. The amount of the incentives will increasefrom month to month. For example in an employee can achieved all thecriteria for January to December than the total incentives received bythe employee will be RM 750.00 (Table 6). However if the employee failto meet any one of the qualifying criteria in any given month will renderthe employee to restart at the minimum amount of RM 35 per month uponmeeting the qualifying criteria for the month.

Qualification Criteria:a. Nil late attendance for that month except with valid late comings reasons needs to

be approved by respective Head of Department.b. Nil absenteeism for the month except with valid reasons needs to be approved by

respective Head of Departmentc. Only one (1) medical leave for the monthd. Nil disciplinary record for the months i.e. written counseling , warning letter


Months Monthly Amount (RM)

Accumulated Monthly Amount (RM)

January 35 35

February 40 75

March 45 120

April 50 170

May 55 225

June 60 285

July 65 350

August 70 420

September 75 495

October 80 575

November 85 660

December 90 750


PLWS Model

Bonus Based on Profits/Returns

Increment Based on Performance

Incentives based on employees quality

Transformation, Innovation & Partnership

Incentives Based on Individual/Team/Company Performance/Target

Incentives Based on Skills

Bonus based on Sales/Total Output


PLWS COMMITTEEAdvisor

(Directors)

PLWS Committeei.Head of each Department

ii.HR Department (Secretariat)iii.Employee representative

Production QA Safety & Health HR / Finance

Maintenance Sales & Delivery Procurement


THE COMMITTEE’S TERMS OF REFERENCE (TOR)

wage transformation through productivity-linked wage system (plws)

Documents

high productivity

high value

employee labour productivity

high labour costtotal

high labour costlabour

high ratio

high returns

unit labour cost