New minimum wage may be sooner than year-end

The early implementation will be in line with the improved economic situation and rise in cost of living 


THE government has proposed to implement the new minimum monthly wage of RM1,500 sooner, rather than its initial plans by the end of 2022. 

Human Resources Minister Datuk Seri M Saravanan said the proposal considers the country’s current economic situation, which has improved with most businesses seen growing and recovering. 

“The government takes note of the demands of some parties to expedite the increase of the new minimum wage due to the current economic situation and the rising cost of living,” Saravanan told the Dewan Rakyat yesterday. 

He also said Malaysia’s GDP registered an increase of 3.6% in the fourth quarter of 2021 and is expected to increase this year. 

“This can be achieved with the government’s financial assistance so employers can continue and maintain their business operations. 

“Based on Budget 2022’s projections, this performance is expected to grow at a rate of 5.5% to 6.5% in 2022,” he said. 

Meanwhile, Saravanan said the government cannot raise wages drastically to RM1,600 a month as questioned by Muar MP Syed Saddiq Syed Abdul Rahman. 

“The government stresses that the increase in the minimum wage rate should be implemented in stages to ensure the continuity of companies’ operations and employees’ employment can be maintained. 

“Excessive and drastic increases could affect the country’s competitiveness and will cause Malaysia’s labour market to face the challenge of creating new highquality and highly skilled jobs,” he said. 

Last month, Saravanan announced that the country’s new minimum wage would be increased to “around RM1,500 monthly” which is expected to be implemented before year-end. 

However, he said the government is still finalising the matter to address current challenges before it can be implemented. 

“We do not want companies to take advantage of this by reducing the number of employees. 

“This will defeat its purpose while we are aiming to further reduce the country’s unemployment rate from 4.2% to 4%,” he said in response to Baling MP Datuk Seri Abdul Azeez Abdul Rahim.