National Wage Index to serve as remuneration guidelines

The index can be used as a benchmark to ensure fair and transparent deals that would benefit all parties


Employers should utilise the National Wage Index (NWI) as a benchmark for the remuneration packages that are offered to employees to ensure fair and transparent deals that would benefit all parties.

Human Resources Minister M Kulasegaran (picture) said the wage index will provide objectivity to the employers’ managerial decision, especially in raising wages and salaries, as well as during the bargaining process of collective agreements.

“This index can be used as the benchmark and it will ensure the rationalisation of a wages placement as well as its analysis, which have often been done subjectively,” he said at the launch of NWI in Putrajaya yesterday.

The index was mooted under the 11th Malaysia Plan (11MP), an initiative to mea- sure changes in salaries and wages of public and private workers in the country.

Kulasegaran said the index is one of the 11 labour market consolidation initiatives under the 11MP that has placed the enhancement of the country’s productivity and job creation as the main priorities.

“The wage index is not something new as it has been widely adopted in developed countries.

“It is also an important element that serves as the labour market indicator, and it is possible now to consider the development of wages through the wage index alongside other economic indicators,” he said.

Kulasegaran said the ministry’s other priorities include accommodating individuals who are above the retirement age and the differently-abled (OKU) workers while narrowing the gender gap in the workforce.

“After this, we will focus on the initiative of supporting women’s involvement in the workforce, as well as accommodating workers who are over 60 years old and the OKU, so that they will have a chance to re-enter or have a good start in the labour market.

“I have spoken to agencies under the ministry to retain those above 60 years old who are interested to continue working.

“These are the government’s goal to prioritise these labour groups and to find the most viable solutions for them,” he said.

According to NWI, which is a compilation of survey in eight consecutive quarters between September 2016 and June 2018, the basic wages have risen 8.2% over the review period.

“Basic wages have risen faster in the private sector with 8.3% compared to 7.8% in the public sector.

“By the geographical region, basic wages rose 8.6% in Peninsular Malaysia, 6.6% in Sarawak and 5.4% in Sabah during this period,” the survey read.