31 October, 2017
Human Resources Minister Datuk Seri Dr. Richard Riot Jaem has announced that there will be a new minimum wage for Malaysia next year. He was reported as saying that the new minimum wage will try to narrow the wage gap between those working in Peninsular Malaysia, and those working in East Malaysia. He expressed hope for the minimum wage to be standardised across all states in Malaysia in the future.
Currently, the minimum monthly wage for employees in Peninsular Malaysia is RM1,000.00 a month, whereas for employees in Sabah, Sarawak and Labuan it is RM920.00 a month. The minimum wage was last revised on 1 July 2016.
The Ministry did not release any details about the proposed new minimum wage, save that it is being studied by the Minimum Wages Technical Committee and the National Wages Consultative Council.
As usual, any increase in minimum wage is a balancing act between the interests of employers and employees. The Malaysian Employers Federation previously expressed concern that in the current economic condition, employers are already struggling to manage the costs of operating their businesses. MEF stated that the increase in costs that comes with an increase in the minimum wage may result in employers reducing the number of employees just to maintain costs.
For further information, please contact:
Donovan Cheah, Partner, Donovan & Ho
donovan@dnh.com.my
