KUALA LUMPUR, Oct 19 — The new minimum wage of RM1,700, which will take effect in February, applies to all workers, including non-citizens in the private sector, except for domestic workers and apprenticeship contractors.
According to the frequently asked questions (FAQ) on the Minimum Wage Order, prepared by the National Wages Consultative Council Secretariat, the policy cannot discriminate against any worker on the grounds of nationality, in line with the International Labour Organisation’s Equal Remuneration Convention (No.100), which Malaysia ratified in 1997.
Furthermore, Section 69F of the Employment Act 1955, Section 118B of the Sabah Labour Ordinance (Chapter 67), and Section 119B of the Sarawak Labour Ordinance (Chapter 76) prohibit any form of discrimination between local and foreign workers.
“Employers are required to pay the minimum wage rate to employees, even if the employee agrees to be paid a basic wage lower than the minimum wage, in accordance with Section 43 of the National Wages Consultative Council Act 2011 (Act 732),” it said.
Prime Minister Datuk Seri Anwar Ibrahim, when tabling Budget 2025 yesterday, announced the minimum wage will be raised from RM1,500 to RM1,700 per month, effective February 1.
Anwar, who is also Finance Minister, said the government will give companies with fewer than five employees until August 1 to comply with the decision.
The FAQ said the Minimum Wage Order applies to employers with five or more employees, as well as employers engaged in professional activities regardless of the number of employees.
According to the Malaysian Standard Classification of Occupations 2020, there are nine major sub-groups of professional activities: science and engineering, health, teaching, business and administration, information and communication technology, legal, hospitality and related services, social and cultural, and regulatory bodies.
It said employees not paid a basic salary but are paid based on piece rates, tonnage, task rates, travel, or commissions must receive a monthly wage of no less than the current minimum monthly wage of RM1,700.
According to the FAQ, the implementation of the order does not conflict with employers who adopt the Productivity-Linked Wage System, provided employees do not receive less than the minimum wage rate.
Additionally, the Minimum Wage Order will not be replaced by the Progressive Wage Policy, as that policy complements the minimum wage and is implemented voluntarily by employers.
With the gazettement of the Minimum Wage Order 2024, the 2022 order will be revoked, but any legal proceedings, prosecutions, or investigations initiated under the 2022 order will continue to completion.
“All service contracts and collective agreements must take into account all provisions in the 2024 order,” said the FAQ.
The Minimum Work Order is enforced by the Labour Departments of Peninsular Malaysia, Sabah, and Sarawak, and any violations can be reported to authorities.
Employers who fail to comply with the order face penalties ranging from RM1,000 to RM20,000 or imprisonment for up to five years.
— Bernama
