Malaysia’s Minimum Wage 2025 for Full Timers & Part Timers: Latest Updates

2025 is just a few months away, and with it comes adjustments to Malaysia’s minimum wage.

If you’re running a business, now’s the time to get prepared for these changes and what they mean for your team’s paychecks.

In this article, we’ll break down the new minimum wage rates, how they impact employers like you, and a few tips to help you manage the shift smoothly.

Let’s keep it simple and actionable, so you’re ready to tackle 2025 with confidence.

Current Minimum Wage Regulations in Malaysia

Minimum wage is the legal minimum amount employers must pay their workers, ensuring fair compensation for their efforts.

It’s a way to protect workers’ livelihoods while balancing business needs.

In Malaysia, this rate is reviewed periodically to reflect changes in living costs and economic conditions.

Starting February 1, 2025, Malaysia’s minimum wage will increase to RM 1,700 per month for most businesses.

Minimum wage over 5 years in Malaysia

To understand how this increase compares, here’s an overview of minimum wage changes over the past few years:

Year	Minimum wage (monthly)	Notes
2020	RM 1,200	Increased for Peninsular Malaysia; East Malaysia remained at RM 1,100.
2021	RM 1,200	No updates as the economy focused on pandemic recovery.
2022	RM 1,500	Significant hike across the country, effective May 1, 2022.
2023	RM 1,500	Rate maintained in preparation for further reviews.
2024	RM 1,500	No adjustments ahead of the 2025 increase.
2025	RM 1,700	Effective February 1, for most businesses with outlined exceptions.

What’s Changing in Malaysia’s Minimum Wage?

Big changes are coming to Malaysia’s minimum wage in 2025, and here’s what you need to know as an employer:

Higher Minimum Wage Rates

Malaysia's minimum wage will rise by 13.3% in February 2025, from the current RM 1,500 to RM 1,700 per month. It applies for most business and here’s a breakdown:

Who needs to pay RM 1,700

Companies with five or more workers,
Employers engaged in professional activities (see the details below), regardless of the number of employees they hire.
On August 1, 2025, RM1,700 minimum wage will be extended to all employers, including those with fewer than five employees, as the grace period for these small employers will end.

Who sticks with RM 1,500

Smaller businesses with fewer than five employees in non-professional sectors can continue paying the current rate of RM 1,500.

These updates apply to all employees, whether they’re full time, part-time, or paid by task or commission. However, apprentice and domestic workers are excluded from these charges.

Who is regarded as professional activities?

Professional activities are classified under MASCO's Major Group 2: Professionals. This group includes nine subcategories:

Science and Engineering Professionals
Health Professionals
Teaching Professionals
Business and Administration Professionals
Information and Communication Technology (ICT) Professionals
Legal Professionals
Hospitality and Related Services Professionals
Social and Cultural Professionals
Regulatory Professionals

Urban vs Rural Differences

To make things fairer, the government is keeping a difference between urban and rural areas.

These adjustments aim to balance fair wages for workers while supporting smaller businesses in less costly regions.

Urban areas: the new RM 1,700 minimum wage applies to most businesses, especially in cities like Kuala Lumpur, Johor Bahru, and Penang, where living costs are higher.
Rural areas: some smaller businesses in rural regions can stick to RM 1,500. However, businesses in professional professional fields (like law or medicine), will still need to pay the new rate of RM 1,700, even in rural regions.

Monthly Minimum Wage Breakdown for Full/Part Timers

To better understand how the new minimum wage works, let’s break it down by daily rates based on the number of days worked per week.

The revised minimum wage also applies to employees working on a daily or hourly basis, including part-time workers.

Minimum Wage Rates for Businesses in City Council or Municipal Council Areas

Category	Monthly (RM)	Daily (RM)	Hourly (RM)
Number of Working Days per Week	6 Days	5 Days	4 Days
Before Amendments	1,200.00	46.15	55.38
Current Rates	1,500.00	57.69	69.23

Minimum Wage Rates for Businesses Outside City Council or Municipal Council Areas

Category	Monthly (RM)	Daily (RM)	Hourly (RM)
Number of Working Days per Week	6 Days	5 Days	4 Days
Before Amendments	1,100.00	42.31	50.77
Current Rates	1,500.00	57.69	69.23

This table helps you understand how the RM 1,700 monthly minimum wage translates into daily rates for different work schedules.

By referring to this, you can calculate wages for employees working various numbers of days per week while ensuring compliance with the minimum wage regulations.

Impacts of Minimum Wage Increases on Employers

With the new minimum wage set to rise in 2025, you will need to adapt. Here’s how the increase could affect your business and how to handle it:

1. Cost implications

The increase in minimum wage means higher labor costs, and this can impact your overall budget. To manage these costs:

Review your budget and see where you can adjust other expenses.
Improve efficiency in operations to offset the additional labor costs.
If needed, increase prices for products or services to maintain profitability, but be mindful of market conditions and competition.

2. Compensation and benefit

Along with the wage increase, you might need to adjust your compensation structure:

Update pay scales to ensure all employees earn at least the minimum wage.
Consider adjusting bonuses and other employee benefits to stay competitive. Offering additional perks, like flexible work hours or health benefits, can also help boost employee satisfaction without putting too much pressure on your budget.

3. Employment contracts

Don’t forget to update your employment contracts to reflect the new wage rates. This ensures your contracts stay compliant with the law:

Review existing contracts and make necessary changes to the salary section.
Ensure that any employees earning below the new minimum wage are brought up to the required rate.
Consider communicating the updates clearly to your employees so they understand the changes.

Actions for Employers Who Fail to Comply with the Minimum Wage Order

According to Section 43 of the Minimum Wage Act 732, employers who fail to comply with the Minimum Wage Order starting in 2025 may face the following penalties if convicted:

First Offense Penalty: A fine of up to RM 10,000 for each employee.
General Penalty: A fine of up to RM 10,000 for each violation where a specific penalty is not stated.
Continuous Offense Penalty: A fine of up to RM 1,000 for each day the offense continues after conviction.
Repeated Offense Penalty: A fine of up to RM 20,000 or imprisonment for up to 5 years.

Employee Complaints

If there is a violation of the Minimum Wage Order, employees can file a complaint with the Department of Labour.

Here are the contact details for the relevant Labour Departments:

Department of Labour Peninsular Malaysia

Ministry of Human Resources
Level 5, Block Setia Perkasa 3, Setia Perkasa Complex
Federal Government Administrative Centre
62530 PUTRAJAYA
Tel: 03-88865192 | Fax: 03-88892368
Email: jtksm@mohr.gov.my
Website: jtksm.mohr.gov.my

Department of Labour Sabah

Ministry of Human Resources
Level 1, Blocks C & D, KWSP Building P/S 14557
88852, Kota Kinabalu, SABAH
Tel: 088-238755/233820 | Fax: 088-242445
Email: jtknsabah@mohr.gov.my
Website: jtksabah.gov.my

Department of Labour Sarawak

Ministry of Human Resources
Level 13, Sultan Iskandar Building, Jalan Simpang Tiga
93532, Kuching, SARAWAK
Tel: 082-242261/414062 | Fax: 082-244909
Email: gajimin@mohr.gov.my
Website: jtkswk.gov.my

FAQ about Minimum Wage 2025 in Malaysia

Can Employers Pay a Lower Basic Salary Than the Minimum Wage if Agreed by the Employee?

No, employers cannot pay a lower basic salary than the minimum wage, even if the employee agrees.

This is considered an offense under Section 43 of the Minimum Wage Act 732. Employers are required to pay the minimum wage rate to their employees, regardless of the employee's agreement to receive a lower salary.

Who is Covered by the Minimum Wage Order (PGM)?

The Minimum Wage Order applies to all employees, including non-citizen workers in the private sector, except for domestic workers and apprenticeship contracts.

Why Are Foreign or Non-Citizen Workers Not Exempted from the Minimum Wage?

The government has determined that the Minimum Wage Order covers all workers, including foreign or non-citizen workers, based on the following reasons:

The minimum wage policy should not discriminate against any worker based on nationality, in line with ILO Convention No. 100: Equal Remuneration, which Malaysia ratified in 1997.
It is in accordance with Section 69F of the Employment Act 1955 [Act 265], Section 118B of the Sabah Labour Ordinance [Cap 67], and Section 119B of the Sarawak Labour Ordinance [Cap 76], which prohibit any form of discrimination between local and foreign workers.

What Are the Legal Implications When the 2024 Minimum Wage Order is Gazetted?

When the 2024 Minimum Wage Order is gazetted, the following legal implications apply:

The 2022 Minimum Wage Order will be revoked. However, any legal proceedings, prosecutions, or investigations under the 2022 Minimum Wage Order will continue until they are completed.
All service contracts and collective agreements must comply with the provisions in the 2024 Minimum Wage Order.

Will the Minimum Wage Be Replaced by the Progressive Wage Policy?

No. The Progressive Wage Policy is a complement to the minimum wage and is implemented voluntarily by employers. It is not a replacement for the minimum wage.

Who Enforces the Minimum Wage Order?

The Minimum Wage Order is enforced by the following departments:

Department of Labour Peninsular Malaysia (JTKSM)
Department of Labour Sabah (JTK Sabah)
Department of Labour Sarawak (JTK Sarawak)

Where Can Employees File Complaints Regarding Minimum Wage Violations?

If there is a violation of the Minimum Wage Order, employees can file a complaint with the relevant Labour Departments:

JTKSM (Peninsular Malaysia)
JTK Sabah
JTK Sarawak

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