PETALING JAYA: The Cabinet has agreed that workers’ wages should continue to increase, but micro, small and medium enterprises (SMEs) will be exempted from the new minimum wage increase for the time being.
Entrepreneur Development and Cooperatives Minister Steven Sim said the decision took into account the operating cost pressures and current economic challenges faced by local businesses, particularly SMEs.
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“I raised the issue of the minimum wage at today’s Cabinet meeting.
“The Cabinet agreed that workers’ wages should continue to increase. However, we also need to protect local businesses, particularly SMEs, which are facing operating cost pressures and current economic challenges,” he said in a statement on Wednesday (Sept 30).
Sim said the Cabinet agreed to exempt SMEs from the new minimum wage increase for now, taking into consideration the sector’s ability to absorb the higher costs.
He said the government would adopt other measures to help increase wages for workers in the SME sector, including wage subsidies under the Progressive Wage Policy.
“This is so that wage increases can move in tandem with productivity growth,” he said.
Sim said the government’s objective was to ensure workers’ welfare was protected through fairer wages while allowing SMEs to remain competitive, grow and continue creating employment opportunities.
