Malaysia has officially announced a major update to its national wage policy through the Minimum Wages Order 2024 (P.U.(A) 376/2024), gazetted on 4 December 2024. This new order raises the monthly minimum wage to RM 1,700 and introduces a phased implementation plan designed to give businesses time to adjust, especially smaller enterprises and those in non-professional sectors.
This article outlines the key provisions, timelines, and compliance requirements under the new wage structure.
📆 Phased Implementation Timeline
The RM 1,700 minimum wage will come into force in two stages, depending on the size and classification of the employer:
Phase 1: Effective 1 February 2025
Applies to:
- Employers with five (5) or more employees
- All employers involved in professional activities as defined under MASCO 2020, regardless of the number of employees
Phase 2: Effective 1 August 2025
Applies to:
- Employers with fewer than five (5) employees and not classified under MASCO 2020 as professional activities
Until 31 July 2025, these smaller non-professional employers may continue paying the previous minimum wage of RM 1,500/month.
💵 Revised Wage Structure
The Minimum Wages Order 2024 sets out the following minimum wage rates:
| Type of Employment | Minimum Pay |
|---|---|
| Monthly | RM 1,700 |
| Daily (6-day week) | RM 65.38 |
| Daily (5-day week) | RM 78.46 |
| Daily (4-day week) | RM 98.08 |
| Hourly | RM 8.72 |
For employees paid based on productivity (e.g. by task, piece rate, or tonnage):
- RM 1,700/month applies from 1 February 2025 for large and professional-sector employers
- RM 1,500/month remains valid until 31 July 2025 for small, non-professional employers
👤 Who Must Comply?
The Minimum Wages Order 2024 applies to all private-sector employers in Malaysia, whether the employees are local or foreign workers. This includes:
- Full-time and part-time workers
- Temporary and contract employees
- Foreign nationals employed legally
❌ Not Covered:
- Domestic servants (e.g. household maids, live-in domestic workers) are excluded from the Order
🧾 What is MASCO 2020?
The Malaysia Standard Classification of Occupations (MASCO 2020) is the national reference for categorizing job functions and occupations. Under this framework, professional activities include fields such as:
- Legal services (e.g. lawyers)
- Engineering
- Finance and accounting
- Information and communications technology
- Medicine and healthcare
- Scientific research
- Architecture and design
Businesses that fall under these categories must comply with the RM 1,700 minimum wage by 1 February 2025, regardless of how many employees they have.
⚠️ Legal Penalties for Non-Compliance
Employers who fail to comply with the Minimum Wages Order face serious legal consequences under the National Wages Consultative Council Act 2011:
- Fines of up to RM 10,000 per employee
- Daily fines up to RM 1,000 for ongoing violations
- Repeat offenders may be fined up to RM 20,000 or face up to 5 years of imprisonment
The government has emphasized strict enforcement and encourages all employers to prepare in advance.
✅ What Employers Should Do Now
To comply with the Minimum Wages Order 2024, employers should take the following steps:
Review Payroll
Ensure that all employees are being paid at or above the new minimum wage based on the relevant implementation date.
Check Your MASCO Classification
Determine if your business activities fall under the “professional” category as per MASCO 2020.
Update Employment Contracts
Adjust wage terms in all existing and new employment contracts to reflect the new minimum wage.
Train Payroll and HR Staff
Ensure payroll and HR personnel are familiar with the new rules and dates.
Plan Financial Adjustments
Update budgets and cost forecasts to account for higher payroll obligations.
🔍 Why This Matters
The 2024 update represents a significant step by the Malaysian government to ensure that workers earn a fair and sustainable living wage. It reflects a broader commitment to economic reform and social protection, especially in the context of inflation and cost-of-living increases.
Employers who embrace these changes not only remain compliant but also support workforce retention, morale, and long-term business resilience.
If you need assistance with compliance checks, MASCO classification, or revising employment policies and contracts, don’t hesitate to reach out for professional guidance.
William Lee (kokwei67@gmail.com) is a content creator under the Newswav Creator programme, where you get to express yourself, be a citizen journalist, and at the same time monetize your content & reach millions of users on Newswav. Log in to creator.newswav.com and become a Newswav Creator now!
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