KUALA LUMPUR (Dec 24): The minimum wage hike to RM1,200 in 57 towns and cities in Malaysia in 2020 is a calculated effort to alleviate urban poverty of both local and migrant workers, said Primary Industries Minister Teresa Kok.
She said the cabinet's move to raise minimum wages by RM100, from RM1,100 to RM1,200, is reasonable and will not cause significant impairment to the bottom lines of employers.
Kok's statement today came on the heels of the Malaysian Employers Federation's (MEF) statement yesterday in which it said Putrajaya's decision would result in an estimated RM2.5 billion additional remittances out of the country by foreign workers annually.
The minister said: "MEF should understand that the increase of salary will increase the purchasing power of the people, thus leading to the boost of the general economic growth of the country."
According to Kok, the wage hike is in tandem with the higher living costs in major cities and towns and is consonant with the rate of current inflation.
"Indeed, it is an accepted reality that one can't hire a full time staff for a salary of below RM1,200 in many many cities and urban areas in Malaysia these days.
"The move to increase minimum wages is also a calculated effort to alleviate urban poverty of both local and migrant workers. It will also encourage more Malaysians to stay and work in Malaysia," she said.
Kok added that the move to increase wages by RM100 for migrant workers, under the principle of equality, is in line with keeping with international standards, primarily to avert discrimination of wages and treatment between the locals and migrant workers.
"Under Pillar 3: 'Spur Sustainable and Equitable Economic Growth' in the Pakatan Harapan Manifesto, we have pledged to increase the minimum wage to RM1,500 within the period of five years.
"Thus, the increase of RM100 for the employees in the urban areas is amongst the initial steps taken by the government toward this direction," she said.