We don’t want businesses shuttered due to floor wage, labour minister tells bosses

Kulasegaran said the council is submitting a proposed minimum wage to the cabinet, taking into consideration socio-economic factors. — Picture by Miera Zulyana
Kulasegaran said the council is submitting a proposed minimum wage to the cabinet, taking into consideration socio-economic factors. — Picture by Miera Zulyana

KUALA LUMPUR, June 13 — Human Resources Minister M. Kulasegaran assured employers today that the government will give serious consideration to their views before deciding on the new minimum wage.

He added that the government is leaning towards a gradual increase in the monthly salaries as the most acceptable solution.

“If the increase is too steep it will affect businesses, mainly the smaller ones and even to the extent of closing down.

“We definitely don’t want that to happen because business closures will also result in the laying off of workers,” he said after a meeting with the National Wages Consultative Council and the Wages Technical Consultative Committee.

Kulasegaran said the council is submitting a proposed minimum wage to the cabinet, taking into consideration socio-economic factors such as the employer’s ability to pay wages, productivity rate, cost of living index and current labour market conditions — such as the current employment rate.

“This is a good approach as proposals to the cabinet should not just be based on whims and fancies,” he said in his speech.

Kulasegaran added that the ministry has also instructed the labour department (JTK) to further strengthen its enforcement activities, especially to ensure compliance amongst the SME employers.

“I strongly believe that it is not good enough to just have good policies in place without a good enforcement mechanism,” he said.

He said as far as minimum wages is concerned, from January 1, 2014 to March 31, 2018, a total of 168,000 places of employment has been inspected for minimum wage compliance.

And out of these inspected places, a total of 166,000 places or 98 per cent of employers inspected has complied with the minimum wage ruling.

“No worker will become rich from earning a higher minimum wage,” he said.

Recently, Kulasegaran said the government plans to announce the outcome of its minimum wage review by August.

Pakatan Harapan in its manifesto had pledged to standardise and increase monthly minimum wages to RM1,500 by the first term and review it every two years.

Currently the minimum wage rate is RM1,000 for Peninsular Malaysia and RM920 for Sabah, Sarawak and Labuan.

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