Human Resources Minister Datuk Seri M Saravanan has said that several sectors and entities will be allowed some flexibility when implementing the new minimum wage of RM1,500, which is set to take effect on 1 May 2022.
According to the minister, entities in the informal sector, odd-job workers, businesses with less than five employees, as well as companies that have suffered substantial losses – such as those in the hospitality and tourism industries – will be given leeway of a year to implement the new minimum wage. Additionally, the flexibility period may be extended according to the minister’s purview.
“Odd-job workers are still earning RM500 to RM600 salary. If I force companies to pay them RM1,500, they will soon be out of a job,” said Datuk Seri M Saravanan, adding that a similar approach was also adopted by the government back in 2012.
Earlier in March 2022, Prime Minister Datuk Seri Ismail Sabri Yaakob had announced the government’s green light to increase the minimum wage from RM1,200 to RM1,500. The new rate will apply first to private sector companies with at least five employees, whereas discussions will be held on delaying the implementation for small and micro companies since they may not be able to pay the new minimum wage.
The implementation of the new minimum wage is in accordance with the National Wage Consultative Council Act 2011 (Act 732), which stipulates that the amount needs to be reviewed at least once every two years. Last adjusted in February 2020, the current minimum wage in urban areas is RM1,200 per month. The minimum salary in rural areas, meanwhile, is slightly lower with RM1,100 per month.
