Malaysia to standardise minimum wage at RM1,050 nationwide from January

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KUALA LUMPUR (Sept 5): The government today confirmed that a standardised minimum wage of RM1,050 a month, or RM5.05 an hour, will be implemented throughout the country from January 2019.

"The increase in minimum wage is in line with the country's current economic situation," the Prime Minister's Office said in a statement, stressing that any drastic increase in wages will cause other problems for industries and could affect the country's competitiveness.

"As such, it is more appropriate if the minimum wage is raised in stages in the coming years so that industries, especially the smaller employers, will not have to close down their businesses due to the higher operating cost that could lead to the termination of employees," it added.

The decision to raise the minimum wage was decided at a Cabinet meeting today after considering the recommendations of the National Wage Consultative Council (NWCC) following its review of the 2016 Minimum Wage Order.

The statement said that due to the current financial constraints, the government has decided not to provide any subsidy to employers as it rolls out the new minimum wage.

Pakatan Harapan had in its election manifesto pledged to bear 50% of any increase in minimum wage to relieve the burden of employers.

Pakatan had also promised to standardise the minimum wage throughout the country in its first 100 days in power, and raise the amount to RM1,500 monthly within its first five-year term.

Once gazetted, the new minimum wage scheme will be the third government order, replacing the previous orders, which was first launched on July 1, 2013 and subsequently on July 1, 2016.

Currently, the minimum wage is set at RM1,000 per month or RM4.81 an hour in the peninsula, and RM920 a month or RM4.42 per hour in Sabah, Sarawak and Labuan.

When the scheme was first introduced in 2013, the minimum wage was set at RM900 a month or RM4.33 per hour in the peninsula, and RM800 a month or RM3.85 per hour in Sabah, Sarawak and Labuan.

The government today also urged employers and traders not raise prices of goods and services once the new minimum wage is implemented.

"The Domestic Trade and Consumer Affairs Ministry is tasked to monitor the situation," the statement said.

Established in 2011 under an act of parliament, NWCC comes under the purview of the Human Resources Ministry, and its members comprise representatives of the employers, employees, government, and industry experts.