Business decisions not your business, Putrajaya told over Foodpanda dispute

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A think tank says Putrajaya should focus on developing the business environment rather than on individual business decisions, after the government stepped in to solve a dispute between food delivery company Foodpanda and its riders over a new payment scheme.

The Institute for Democracy and Economic Affairs, or IDEAS, said while the government can formulate a framework to regulate a gig economy, it is unwise to instruct companies about their business decisions.

“It might create concerns within the business community that the government is prepared to intervene in decisions of individual companies when things get political,” IDEAS research director Laurence Todd told FMT.

On Tuesday, Youth and Sports Minister Syed Saddiq Syed Abdul Rahman threw his support behind Foodpanda riders protesting against a new payment scheme they said would see a drop in their daily income.

Yesterday, Syed Saddiq, saying the welfare of workers should not be sacrificed, urged the company to revert to its previous payment scheme.

The new payment scheme does away with paying riders by the hour, although riders get more commission for every order delivered, from RM4.50 to RM7.

Under the old payment scheme, riders got RM4 per hour with an additional pay of between RM3 and RM5 per order, based on their performance.

Todd said there are questions on the government’s impartiality as well as the stability of the business environment from remarks by government leaders on the Foodpanda controversy.

He said the government should be clear about its focus on the business environment, not individual businesses.

Todd also said the government must avoid knee-jerk reactions.

He cited as example e-hailing regulations, which he said was well intended but flawed.

“The problem was that the regulations which applied to taxis were effectively transferred across, without reflecting on how the underlying business models were different.”

He said the requirement that all vehicles go through Puspakom has resulted in delays, and that a better move would have been to open up the vehicle inspection system.

Nabil Feisal Bamadhaj, who founded local motorcycle ride-hailing service Dego Ride, welcomed the government’s intervention in the Foodpanda dispute.

He said it showed the authorities are listening to the voices of the deliverymen, and cared for their livelihood.

“It’s just a suggestion and it’s up to the private sector to decide on what to do.”

Nabil said in a gig economy, performance equalled earnings, and that the more work a person did, the more they could earn.


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