New minimum wage brings cheer to private sector
Published on: Saturday, January 12, 2019
By: Bernama

KUALA LUMPUR: The new year has brought some cheer to private-sector blue-collar workers and employees in the lower salary scales with the enforcement of the higher minimum wage of RM1,100 a month or RM5.29 an hour starting Jan 1.

Announced by Finance Minister Lim Guan Eng during the tabling of Budget 2019 on Nov 2, the new minimum wage will benefit some 1.28 million workers or 18.1 percent of the 7.05 million workforce in the private sector that work at least six hours a day or 20 days a month. (These statistics are based on the Department of Statistics Malaysia’s 2017 Salaries and Wages Survey Report.)

This is also the first time the minimum wage is being standardised for the peninsula and Sabah, Sarawak and Labuan.

Setting up a  uniform minimum wage across the board will help reduce the wage and socio-economic gap between Sabah and Sarawak and the peninsular, which is in keeping with a pledge made by the Pakatan Harapan (PH) government in its 2018 election manifesto.

Malaysia introduced its minimum wage policy in 2012 after the National Wages Consultative Council Act 2011 was passed by Parliament. Under this law, the National Wages Consultative Council (NWCC) was set up to set the framework for the establishment of minimum wages in Malaysia.

Under NWCC’s Minimum Wages Order 2012, which was enforced on Jan 1, 2013, the minimum wage was fixed at RM900 a month for the peninsula, and RM800 for Sabah, Sarawak and Labuan.

Starting July 1, 2016, as per the Minimum Wages Order 2016, the minimum wage was raised to RM1,000 a month in the peninsula, and RM920 in Sabah, Sarawak and Labuan.

The RM100 hike in the minimum wage may seem small to many but for private-sector employees like Mohd Izzat, 25, whose salary scales are at the lower end, any rise in income is helpful.   

 “It may seem like a small amount but it will come in handy for us, together with the other aid the government is extending to the B40 group, such as the electricity subsidy,” he said, adding that the RON95 petrol subsidy for motorcycle owners would also help to ease his financial burden as he goes to and fro work by motorcycle.

Mohd Izzat, who is single and has two brothers who are still in school, also hoped the government would fulfil its election pledge by raising the minimum wage to RM1,500 a month due to the rising cost of living.

Last September, the Prime Minister’s Department announced in a statement that a standardised minimum wage would be implemented from Jan 1, 2019, at RM1,050 a month or RM5.05 per hour.

However, following protests by the Malaysian Trades Union Congress (MTUC) and other non-governmental organisations, the government decided to review the RM1,050 minimum wage before raising it to RM1,100.

In its election manifesto, PH had pledged to raise the minimum wage to RM1,500 across the nation. Last August, Human Resources Minister M. Kula Segaran said the proposal to increase the minimum wage to RM1,500 would be done in stages over five years as a lot of companies would face financial difficulties or go bankrupt if it was implemented in one go. – Bernama



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