Minimum Wage According to Sectors will be Implemented in 2 Years
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Human Resources Minister M. Kula Segaran said the government will implement the minimum wage according to sectors in the next two years.
He said according to the National Wages Consultative Council Act (NWWC) 2011, a review of the minimum wage should be executed every two years, “Many people are unaware that matters on wages are determined by a committee (National Wage Legislative Technical Committee), the minister has no power.”
“Before the implementation of the minimum wage of RM1,100, discussions were held to cover all aspects, but according to the NWCC Act 2011, the matter will be reviewed and it is for later, not for now,“ he said.
A more realistic minimum wage
On 24th February 2018, after a discussion with employers from the Sabah chapter of the Malaysian Employers Federation, Kula Segaran said that the government will study the possibility of setting a more realistic minimum wage according to business sectors.
He said the current minimum wage of RM920 to RM1,100 was across the board for all sectors, with some businesses finding it too high and to close some outlets or having to lay off workers.
Credit: Bernama
Under the sector-based minimum wage, Kula Segaran said employees in plantations, hotels and coffee shops, for example, would have different minimum pay.
According to Bernama, the minister also said certain terms under the Employment Act will be studied, including to cover all employees aside from those earning RM2,000 and below
A step backwards?
Sabah Employers Association (SEA) said the proposed set of minimum wage based on sectors is a step backwards. The association said that when the minimum wage was standardised in 2013, it was to do away with the differences across several sectors.
It was also to fulfil the fundamental universal principle: All employees must be guaranteed equal basic benefits for transportation, food, and accommodation.
Based on this principle, the minimum wage was standardised throughout Malaysia, one rate at RM1,100 per month beginning January 2019, even though employers across different states face differing levels of market potentials and business costs, according to SEA.
“Perhaps, the minister meant allowing different sectors to set minimum start work wage levels ‘higher’ than the basic RM1,100 per month, according to differing productivity levels.
“That would be akin to replacing the free market mechanism, which should be better left undisturbed,” SEA said.
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