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NST reported that the government hopes to implement the RM1,500 minimum wage within five years.
Deputy Human Resource Minister Datuk Mahfuz Omar said that it is not impossible that the minimum wage will be reviewed every year, even though the National Wages Consultative Council Act 2011 provides for a review for every 2 years.
“If there is a need, it (a review) can be done more than once (in two years) but it definitely must be done biennially,” he said when answering a question from Cha Kee Chin (PH-Rasah) who wished to know the justification for setting the minimum wage now at RM1,050 which the MP said is seen as “too low”.
Mahfuz said the government knows that the rate is not very high but added that it is a rational approach to prevent a sudden rise in the operating costs of employers, specifically in the small and medium industries.
The minimum wage is a rational approach to avert a sudden rise in the operating costs of employers.
“A rise in the minimum wage will increase the operating costs of the employers, in terms of contributions to the Employees Provident Fund and Socso, payment for overtime and rest-day work and such,” he said.
He said the set setting of a standard minimum wage for the country is also to bridge the socio-economic between Peninsular Malaysia with Sabah, Sarawak and Labuan.
Mahfuz said the increase of RM50 in the wage for the peninsula and RM130 for Sabah, Sarawak and Labuan is sensible and does not threaten a financial burden for 90% of the employers in the small and medium industries.
He also said the government also considered the slower national economic growth, at 4.5% in the second quarter of this year compared to the 5.4% in the first quarter.
“It has also to be viewed from the impact of the flow of investments into Malaysia and the government has to ensure that the existing investors remain in the country,” he said, mentioning that foreign direct investment was lower, at RM2.8 billion, in the second quarter this year compared to RM12 billion in the first quarter.