PETALING JAYA: The exemption of eligible micro, small and medium enterprises (MSMEs) from the revised RM2,000 minimum wage is a pragmatic safeguard for businesses and jobs, says the Malaysian Employers Federation (MEF).
Its senior adviser for government, media and international engagement, Datuk Dr Syed Hussain Syed Husman, said the exemption recognised the differing financial capacities of businesses.
He said it would allow eligible enterprises to manage operating costs and sustain employment while the government pursued its objective of improving workers’ incomes.
“MEF strongly supports this approach because it provides a clear safeguard for eligible MSMEs while balancing workers’ welfare with the sustainability of businesses and employment.
“The Government has even specifically taken steps to distinguish eligible smaller enterprises from businesses required to implement the revised RM2,000 rate,” he said in a MEF statement on Tuesday (Oct 13).
He also noted that the decision provides eligible MSMEs breathing space to manage their resources, maintain operations and continue providing employment without needing to worry about immediate additional wage obligations.
MEF also acknowledged concerns raised by the Small and Medium Enterprises Association (Samenta) that pressure on profit margins could limit MSMEs’ ability to invest in automation, workforce development, and environmental, social and governance (ESG) compliance.
However, the federation said such concerns should not overshadow the government’s explicit decision to exempt eligible MSMEs from the revised minimum wage.
“The question of profit margins should not be used to diminish the significance of this measure, as the exemption is a deliberate policy decision to give eligible businesses room to remain viable, retain workers and strengthen their operations.
“MEF encourages all stakeholders to assess the policy in its entirety, rather than focusing on the wage increase in isolation,” Syed Hussain said.
He added that the RM50mil annual sales threshold finally provided a defined basis for identifying eligible enterprises and offered greater certainty to businesses covered by the exemption.
However, MEF called on the government to provide clear implementation guidelines covering eligibility criteria, the scope of the exemption and compliance requirements.
It said that clearer rules would help employers determine their obligations, plan operations with greater certainty and avoid potential disputes with authorities and workers.
“Workers and businesses depend on each other. Sustainable improvements in wages require viable enterprises, while productive and fairly remunerated workers contribute to stronger businesses.
“The priority now should be to ensure clear implementation, strengthen business productivity and create the conditions for sustainable wage growth that benefits workers, employers and the Malaysian economy,” he said.
