New minimum wage expected to be set soon

KUALA LUMPUR: The implementation of the new minimum wage is expected to take place soon and not at the end of this year, says Human Resources Minister Datuk Seri M. Saravanan.

He said the timetable for the move has been brought forward as the current economic situation is seen to be improving and most businesses are also recovering.

“Malaysia’s GDP recorded an increase of 3.6% in the fourth quarter of 2021. This was made possible with the government’s financial assistance to employers to continue operations and retain workers.

“Based on the projections in Budget 2022, economic performance is expected to grow at a rate of 5.5% to 6.5% in 2022.

“In relation to this, the government proposes the implementation of the new minimum wage rate in the near future and not at the end of 2022, given the current economic situation of the country is seen to be improving,” he said in a parliamentary reply.

Saravanan said although some groups have called for the new minimum wage to be expedited due to the impact of the current economic situation and the rising cost of living, the new rate will only be implemented after considering the people’s real needs and the ability of employers.

To a question by Syed Saddiq Syed Abdul Rahman (Muda-Muar) whether the government would consider increasing the minimum wage to RM1,600 per month, Saravanan said that the increase of must be done in stages.

This is to ensure continuity of business operations and retention of employees, he added.

“Excessively high and drastic increases in the minimum wage rate can affect the country’s competitiveness edge, causing the labour market in the country to face the challenge of creating new high quality and skilled jobs,” said Saravanan.