Article 10: Malaysia's Minimum Wage Set to Rise to RM1,700 in 2025: What Employers and Workers Need to Know
In a landmark move, the Malaysian government announced an increase in the minimum wage from RM1,500 to RM1,700 per month, set to take effect on February 1, 2025. Prime Minister Datuk Seri Anwar Ibrahim highlighted this revision during the tabling of Budget 2025, positioning the increase as part of the government's effort to support low-income earners and enhance their quality of life. This policy aims to create a fairer working environment across Malaysia, where all workers will benefit from a standard minimum wage, regardless of region.
“This new rate was unanimously agreed upon by representatives of employers, workers, and the government in the National Wages Consultative Council (NWCC). The rate will be uniform across the country,” Minister Sim stated.
Delay in Implementation for Small Business Employers
While the new minimum wage takes effect in early 2025, micro-enterprises with fewer than five employees will have a six-month grace period, with the policy coming into effect for them on August 1, 2025. This extension acknowledges the operational challenges faced by smaller businesses and provides them with a buffer to adjust to the changes.
The Malaysian Employers Federation (MEF) expressed appreciation for this grace period. MEF President Datuk Dr Syed Hussain Syed Husman noted that the new minimum wage level provides a baseline for fair remuneration. While most businesses already pay above the minimum wage, the MEF encourages employers who can afford it to offer higher wages, linking compensation to business success and performance.
Introducing Starting Salary Guidelines for Various Sectors
In an additional move, the Human Resources Ministry, also known as KESUMA, will publish guidelines on starting salaries based on the Malaysia Standard Classification of Occupations (MASCO). These guidelines are expected to serve as a reference for both employers and employees in determining fair starting salaries across various job categories, adding transparency to the job market and helping workers better understand industry standards.
Source: https://www.malaymail.com/news/malaysia/2024/10/19/budget-2025-rm1700-minimum-wage-aims-to-uplift-low-income-workers-and-drive-economic-growth-says-steven-sim/154129
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“This new rate was unanimously agreed upon by representatives of employers, workers, and the government in the National Wages Consultative Council (NWCC). The rate will be uniform across the country,” Minister Sim stated.
Delay in Implementation for Small Business Employers
While the new minimum wage takes effect in early 2025, micro-enterprises with fewer than five employees will have a six-month grace period, with the policy coming into effect for them on August 1, 2025. This extension acknowledges the operational challenges faced by smaller businesses and provides them with a buffer to adjust to the changes.
The Malaysian Employers Federation (MEF) expressed appreciation for this grace period. MEF President Datuk Dr Syed Hussain Syed Husman noted that the new minimum wage level provides a baseline for fair remuneration. While most businesses already pay above the minimum wage, the MEF encourages employers who can afford it to offer higher wages, linking compensation to business success and performance.
Introducing Starting Salary Guidelines for Various Sectors
In an additional move, the Human Resources Ministry, also known as KESUMA, will publish guidelines on starting salaries based on the Malaysia Standard Classification of Occupations (MASCO). These guidelines are expected to serve as a reference for both employers and employees in determining fair starting salaries across various job categories, adding transparency to the job market and helping workers better understand industry standards.
Source: https://www.malaymail.com/news/malaysia/2024/10/19/budget-2025-rm1700-minimum-wage-aims-to-uplift-low-income-workers-and-drive-economic-growth-says-steven-sim/154129
Outsourcing payroll, let you focus on what matters most for your busniss grow. For more information, visit to www.alena.com.my or call us +6018 3755170
01 Nov 2024
