Human Resources Minister V. Sivakumar confirms that the minimum wage of RM1,500 remains embedded within the forthcoming progressive wage system policy introduced by the government. The implementation of this progressive model, aligned with the minimum wage, is aimed at enhancing workers’ productivity, thereby benefiting both employees and employers. Sivakumar stresses that lowering the minimum wage would be counterproductive, signaling a regressive approach. He also reveals that the progressive wage system will be presented in the 2024 Budget in October, aligning with anticipated implementation in April or May next year.
Addressing the press during a Labour Dialogue, Sivakumar categorically states, “The minimum wage of RM1,500 is the baseline. If we lower the minimum wage figure, that is not progressive, but regressive.”
The progressive wage system aims to transition from the conventional minimum wage approach to a gradual and phased wage increase that mirrors the country’s economic growth trajectory. The Ministry of Economy recently announced that the policy has garnered cabinet approval, with comprehensive details scheduled for unveiling in the 2024 Budget, anticipated to be presented in October. The policy’s actual implementation is projected for April or May of the following year.
Moreover, Sivakumar reveals insights from the National Economic Action Council (NEAC) meeting chaired by Prime Minister Datuk Seri Anwar Ibrahim, clarifying that the introduction of the progressive wage system is not mandated for all private employers. While RM1,500 serves as the minimum wage threshold, Sivakumar emphasizes that it’s essential to reward skilled and talented workers promptly to enhance their value as assets to their employers.
“In time to come, employers will gradually realize the need to implement progressive wages. So, for the initial stage, we will let employers decide whether they want to use the progressive wage system or not,” Sivakumar elaborates.
The Labour Dialogue, a platform for discussing labor-related concerns, saw participation from various stakeholders, including Deputy Minister in the Sarawak Premier’s Department Datuk Gerawat Gala, Sarawak Manpower Department Director Awang Raduan Awang Omar, employers, trade unions, and training providers.
Sivakumar further reveals plans within his ministry to explore the formulation of the Salary Advertisement Act, aiming to enhance transparency by necessitating employers to publicize salary scales for job offers. This proposed initiative, put forth by Muar Member of Parliament Syed Saddiq Syed Abd Rahman, resonates with the government’s commitment to the welfare of workers and the public.