Unlocking Stalemate Over P-Hailing Riders’ Low Wage Issue

Despite working over 12 hours a day, a p-hailing rider only earns about RM2,000 in monthly wages. That is the stark reality with which most p-hailing workers in the country are faced, especially in the city.

P-hailing is defined as services involving the delivery of food, drinks and parcels using motorcycles.

Riders claim that their current order fees had been reduced from RM10 in 2020 to RM5 for each trip. Their voices should not be left unheard by p-hailing companies.

Mindful of the welfare of workers in the sector, Prime Minister Datuk Seri Anwar Ibrahim held a meeting with the p-hailing riders on July 22 to understand the challenges they face.

To resolve issues pertaining to the order fees, Anwar said he will meet all delivery operators on Aug 8 to seek better commission rates for riders, which are reportedly too low.

Riders interviewed by Bernama expressed hope that the meeting with the Prime Minister will be in their favour.

“I started working as a food delivery rider in 2020, and at that time, our wages were high, fetching up to RM10 per trip, but last year, the rates were reduced to RM7 and for this year, we only received RM5 for our order fees,” shared Dhafiq Othman, 29, to Bernama.

The significant decline in income compared to three years ago, took a psychological toll on Dhafiq, who has two young children to support.

Dhafiq, who holds a diploma in syariah law, said he was forced to work in the gig sector given the difficulties in gaining stable employment.

Low-income households are being hit hardest by inflation because surging food and housing costs make up more of their spending. Of late, these riders have been feeling the pinch from the rising cost of living as they have to ensure their motorbikes are in good condition.

 

A study by the Department of Statistics Malaysia (DOSM) involving a total of 6,657 p-hailing workers found that 97.71 per cent of them were youths aged 15 to 30, while the remaining 2.29 per cent were senior citizens aged 60 and above.

The study conducted from March 1 to Dec 31, 2022 found that most p-hailing workers have an education level of Sijil Pelajaran Malaysia (SPM) / Sijil Pelajaran Malaysia Vokasional (SPMV) or equivalent (39.54 per cent), Diploma or equivalent (23.24 per cent) and Bachelor’s Degree (11.79 per cent).

DOSM also said in the report that 73.98 per cent of p-hailing workers regard the occupation as their main source of income while 70.35 per cent make it their main occupation. Only 29.65 per cent join the service to generate side income.

“We hope this issue can be resolved and finalised by the government given the Prime Minister’s assurance in a meeting with p-hailing workers recently,” said Dhafiq.

Another p-hailing rider Izam Mohamad 22, also has high hopes that the meeting with the Prime Minister would have a positive outcome.

Izam, who has served the p-hailing since last year, described the RM5 fee as unfair as it does not factor in the distance and time taken by a rider to pick up and deliver the food ordered by customers.

 “For a short distance, the RM5 rate is acceptable. But, for long distance delivery and which takes more than 20 minutes to deliver, it is rather unfair to be paid the same amount as we have to bear petrol and maintenance costs,” he lamented.

 

The stiff competition among the operators could have prompted them to reduce the wage rates for riders, said Deputy Dean Graduate School of Business, Universiti Kebangsaan Malaysia (UKM) Assoc Prof Dr Mohd Helmi Ali when asked to comment on the issue.

He said the supply and demand aspects had been affected by the growing number of platforms and industry players in p-hailing, unlike the previous years.

 “This situation is a far cry from the Movement Control Order (MCO) period which saw p-hailing as the key industry player in providing employment for those badly hit by the COVID-19 pandemic. Unlike today, supply (the number of p-hailing platforms has significantly increased) has exceeded demand, which was previously focused on one or two platforms only,” he added.

As a result, there was not much change in profits earned by service providers, coupled with the fact that they were also forced to reduce the wages of p-hailing riders to retain customers.

 However, he concurred with views that the p-hailing workers’ wage rates should be reviewed to reflect the current living conditions and the services offered.

At the same time, he also opined that the time has come for p-hailing to be recognised as a professional job as the sector is the key contributor to the supply chain, especially in pickup and food delivery services.

Besides that, the gig economy became increasingly on-demand when COVID-19 hit the nation as many people lost their jobs and income due to the pandemic, he added.

The best solution to unlock the stalemate over the wage issue between the p-hailing workers and operators is to create a win-win situation between them as well as between vendors and customers, he said.

 “We don’t want to see a situation whereby after the increase in p-hailing riders’ wages, costs incurred by service providers or companies are transferred to customers, pushing costs of goods and food delivery to rise.

 “What’s worrying is the higher delivery fees will drive away customers who no longer see the need to use the p-hailing services,” he said.

 

Senior Lecturer at the Department of Finance, Faculty of Business and Economics, Universiti Malaya, Dr Mohd Zaidi Md Zabri, said the time has come for a review of minimum or equitable wages for p-hailing workers based on their total working hours.

He said it is crucial for young workers to contribute largely to the gig economy and this issue, if not addressed, could cause income disparity in the country.

 Besides that, he also saw the need for companies to improve workers’ welfare through contributions to the Social Security Organisation (Socso) and the Employees Provident Fund (EPF).

 “DOSM data shows that 27.75 per cent of p-hailing workers have not made any contribution to Socso while only 22.05 per cent contribute to EPF.

 “The erosion of labour standards and social security net systems such as these not only affect productivity but could pose health and safety risks for gig workers as they have no social protection”,  he added.

 

Translated by Salbiah Said

 

-- BERNAMA