The Malaysian government’s decision to increase the national minimum wage from RM1,050 (US$252.13) to RM1,100 (US$264.14) has drawn criticism from employers.
Brian Sim, deputy general manager for Kelly Services, Malaysia, told The Edge Markets: “While employees will be celebrating the increase in minimum wages from RM1,050 to RM1,100, we are concerned about the impact of this sudden announcement on businesses that previously expected the increase to only remain at 5%. As the year end approaches, organisations have less than two months to implement the changes announced in today’s budget.”
The government had originally said in September that the minimum wage would be raised next year to RM1,050 (US$252.13) per month across the country. But following worker protests, Finance Minister Lim Guan Eng announced the higher increase in his 2019 Budget speech.
As a result, the Malaysian Employers Federation is now deciding whether to take legal action. Its executive director Shamsuddin Bardan said that by revising the rate, the government had turned its back on the National Wage Consultative Council.
“Once the minimum wage is gazetted, the government sets the rate for two years. Any review of the rate can only be done on 1 January 2021,” he told FMT.
Meanwhile, Crime Prevention Foundation vice-president Tan Sri Lee Lam Thye told The Star that a proposed tax incentive to encourage the employment of senior citizens and ex-convicts would help spur economic growth and get people back into work.
“Prior to this, society, especially employers, were sceptical of hiring ex-convicts. With hardly any chance of getting a job, they returned to their old ways," he said. “With this announcement, they are given a new lease of life.”
The Budget proposes an additional tax break for companies that provide full-time employment for former convicts and senior citizens who are over the age of 60. Lee said the initiative would also reduce the government’s dependence on foreign workers.
Emma Woollacott is a freelance business journalist. Her work has appeared in a wide range of publications, including the Guardian, the Times, Forbes and the BBC.
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The Malaysian government’s decision to increase the national minimum wage from RM1,050 (US$252.13) to RM1,100 (US$264.14) has drawn criticism from employers.
Brian Sim, deputy general manager for Kelly Services, Malaysia, told The Edge Markets: “While employees will be celebrating the increase in minimum wages from RM1,050 to RM1,100, we are concerned about the impact of this sudden announcement on businesses that previously expected the increase to only remain at 5%. As the year end approaches, organisations have less than two months to implement the changes announced in today’s budget.”
The government had originally said in September that the minimum wage would be raised next year to RM1,050 (US$252.13) per month across the country. But following worker protests, Finance Minister Lim Guan Eng announced the higher increase in his 2019 Budget speech.
As a result, the Malaysian Employers Federation is now deciding whether to take legal action. Its executive director Shamsuddin Bardan said that by revising the rate, the government had turned its back on the National Wage Consultative Council.
“Once the minimum wage is gazetted, the government sets the rate for two years. Any review of the rate can only be done on 1 January 2021,” he told FMT.
Meanwhile, Crime Prevention Foundation vice-president Tan Sri Lee Lam Thye told The Star that a proposed tax incentive to encourage the employment of senior citizens and ex-convicts would help spur economic growth and get people back into work.
“Prior to this, society, especially employers, were sceptical of hiring ex-convicts. With hardly any chance of getting a job, they returned to their old ways," he said. “With this announcement, they are given a new lease of life.”
The Budget proposes an additional tax break for companies that provide full-time employment for former convicts and senior citizens who are over the age of 60. Lee said the initiative would also reduce the government’s dependence on foreign workers.
Emma Woollacott is a freelance business journalist. Her work has appeared in a wide range of publications, including the Guardian, the Times, Forbes and the BBC.
OTHER ARTICLES THAT MAY INTEREST YOU
Understanding payroll in Malaysia
A guide to expat taxation in Malaysia
Malaysia threatens penalties for failing to comply with minimum wage
