Announcement

Ministry of Human Resources will be organising Minimum Wage Laboratory Exercise with the collaboration of World Bank on 8 to 14 February 2011 at Putrajaya International Convention Centre (PICC).

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Y.B. Minister Prelude

Ladies and gentlemen,
Salam 1Malaysia,

In line with the "1Malaysia: People First, Performance Now" concept, the Government, through the Ministry of Human Resources, is conducting a feasibility study on implementation of a national minimum wage for private sector workers in Malaysia. The study is also in tandem with the government’s vision towards realising a new economic model founded on high-income economy and improving the living standards of low income households.

Undeniably, there are Malaysians who live below the poverty line income level (PLI) as many workers earn wages less than RM750 per month. Analysis of average wages offered by employers participating in the ministry’s Fast Track Programme from October-December 2009 is shown in the following table Fast Track: Average Wages and Allowances for Local Workers According to Manufacturing Sector Sub-Industry

It is noted that the average wages for five manufacturing sub-sectors i.e. Electric and Electronics, Furniture, Plastics, Gloves and Textiles was RM626.76 per month for basic wages and RM762.20 per month for gross wages including fixed allowances.

These lower income groups, especially in urban areas, are facing hard times to make their ends meet due to ever-increasing cost of living, particularly on the back of price hike in daily necessities. The minimum wage regulation should be at least able to lessen the severity of their hardships.

However, some quarters argue that the setting up of the national minimum wage would lead to negative consequences as it could distort market forces. In addition, the minimum wage could also cause job losses in lower occupation categories where demands still exist for vulnerable groups especially for those working in rural areas. This in turn could result in higher unemployment rate for the country.

We have provided several useful website links for your further references on the minimum wage implementation. Do click them.

We welcome your views, opinions, ideas, suggestions and comments to provide us with better insights in formulating policies and strategies pertaining to the minimum wage. Such feedbacks can be channelled via this blog or by e-mail at gaji_minimum@mohr.gov.my.

Your invaluable input is very much appreciated. Thank you.

Datuk Dr. S. Subramaniam
Menteri Sumber Manusia







Monday, March 22, 2010

MTUC Argument on Minimum Wages

Debate on minimum wage system for workers in Malaysia is not a new thing. Over the years, MTUC has been consistently championing the need to have the system in place. Recently, despite intensifying debate, our struggle has not fruitful yet. Indisputably, wages/ income related issues and poverty are two sides of the same coin. There are Malaysian workers who still earn basic wages below the poverty level.

Cost of living in Malaysia is rising whereas workers income cannot offset the incurring expenses. Should the government decide to withdraw subsidies on certain goods and services, the lives of workers without reasonable income will surely be negatively affected since their wages remain inert while the purchasing power is declining.

It is imperative for the government to implement minimum wage regulation since employers, on their own discretion, will not raise wages rates for low income workers who have to struggle in meeting their daily needs. The government’s aspiration towards a high income economy is unlikely achievable without reasonable minimum wages.

Many people, including the Minister of Human Resources himself, argue that locals not interested to work for private companies due to unattractive and low wages. Transportation cost is higher than before. Food is becoming more costly. Inefficient public transportation forces workers to use their own vehicles which in turn would increase the cost of living.

In this era of rapid development, oppression towards workers should not be heard of anymore. Sadly, the oppression does occur. There are employers who offer very low wages without taking into consideration the living cost especially in urban areas such as Klang Valley. A notion that the market forces should be the deciding factor in determining wages rates not only badly affect workers’ lives but it would also lead to suppression as well.

MTUC stands by its demand that workers in Malaysia should be paid wages of RM1, 200 per month (including Cost-of-Living-Allowance). As Malaysia is moving forward to become a developed country, it is apt and timely to introduce the minimum wage legislation. Many countries all over the world including our neighbours have already implemented the minimum wage system. Bear in mind that a minimum wage does not mean that the wage rate will remain the same. To put it simply, minimum wages are not maximum wages.

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