PETALING JAYA - Malaysian employers are calling for an evidence-based review of the RM1,700 minimum wage, saying any adjustment must balance rising living costs with businesses’ ability to absorb higher labour expenses.
Malaysian Employers Federation (MEF) president Datuk Dr Syed Hussain Syed Husman said the review was reasonable but should not automatically lead to an increase, with the existing rate first assessed against current economic conditions.
“A review should not automatically mean that the minimum wage must be increased, as the existing rate should first be assessed against current economic conditions,” he said, as quoted by Malaysian publication The Star.
Syed Hussain said the review should consider challenges faced by micro, small and medium enterprises (MSMEs) and labour-intensive businesses, which are dealing with high operating and regulatory costs amid global economic uncertainty.
He warned that, in MEF’s assessment, a significant increase in the minimum wage could lead to higher prices, reduced hiring, more automation, job restructuring or fewer working hours. He said productivity, employment, business capacity, sectoral differences and Malaysia’s competitiveness against other Asean economies should also influence any new rate.
The review comes as the government reassesses the RM1,700 minimum wage, with the National Wages Consultative Council involved in evaluating whether the current rate should be maintained or adjusted. Human Resources Minister R. Ramanan said the assessment would consider indicators including inflation, labour productivity, unemployment, poverty-line measures and median wages.
Malaysian National Association of Employment Agencies president Fiona Low said the review was consistent with the National Wages Consultative Council Act, which requires the minimum wage to be reviewed periodically. However, she cautioned against relying solely on blanket mandatory increases.
National Association of Human Resources Malaysia president Zarina Ismail said wage decisions must move together with economic conditions, warning that businesses may struggle to absorb higher costs if wage increases are not matched by broader economic growth.
While employers have stressed the need for sustainability, labour representatives have argued that wages must reflect workers’ actual living costs. UNI Malaysia Labour Centre president Datuk Mohamed Shafie BP Mammal said wages should be judged not only by the figure on a payslip but by what workers can afford with that income.
“For workers, the issue of wages is not merely about a figure on a payslip, as the more important question is what can be purchased with that wage,” he said.
