What is the minimum wage in Malaysia?
What is the definition of minimum wages?
Minimum wages is basic wages, excluding any allowances or other payments.
What is the difference between ‘wages’ and ‘minimum wages’?
‘Wages’ and ‘Minimum Wages’ are described under section 2 of National Wages Consultative Council Act 2011. The ‘wages’ has similar meaning to ‘wages’ in section 2 the Employment Act 1955 or Sabah Labour Ordinance (Cap.67) and Sarawak Labour Ordinance (Cap.76) whereas the ‘minimum wages’ refers to basic wages only, excluding any allowances or other payments.
Who is eligible for minimum wages?
All local and foreign employees who have entered into a contract of service with an employer shall be entitled to receive minimum wages.
Who is not covered by minimum wages?
Domestic servants (e.g. maids, cooks, guards, gardeners and personal drivers). Apprentices who undergo training for a period not less than two years.
What is the minimum wage rate?
Monthly – RM 1,500.00
Hourly – RM 7.21
Daily
– RM 57.69 (6 working days in a week )
– RM 69.23 (5 working days in a week)
– RM 86.54 (4 working days in a week)
(As per Guidelines on the Implementation of the Minimum Wages Order 2022)
When was the Minimum Wages Order enforced?
Effective 1 May 2022
▪ Company that employs 5 people or more
▪ Regardless of the number of employees employed, an employer who carries out a professional activity classified
under the Malaysia Standard Classification of Occupations (MASCO)
Effective 1 July 2023
▪ Company that employs less than 5 people other than the those that carries out a professional activity classified
under the Malaysia Standard Classification of Occupations (MASCO)
Can we include allowances eg. meal, attendance, hardship, chemical or any other allowances to build up the basic salary to RM 1,500?
No, the monthly basic salary excluding allowances must be RM 1,500.
What are the penalties for offences under the Act?
First Offence – Fine of not more than RM10,000 per employee. The court can order the employer to pay each employee the difference between minimum wages rate and the employees’s basic wages.
General Penalty – Fine of not more than RM10,000 for each offence where no penalty is provided.
Penalty for Continued Offence – A daily fine of not more than RM1,000 for continuous offence after conviction.
Penalty for Repeated Offence – A fine of not more than RM20,000 or imprisonment not exceeding 5 years.
Why is there a need for a prison sentence for offences under this Act?
Prison sentences are the penalty of last resort against employers who repeatedly commits an offence.
Is the minimum wage applicable to individuals above 60 years old who are employed under fixed-term contracts?
Yes. The National Wages Consultative Council Act 2011 mandates that anyone considered an employee is entitled to receive wages of at least RM 1,500, regardless of age or fixed-term employment status.
Is it necessary to provide minimum wage for internships? (Internships typically range from 2 to 6 months, occasionally longer)
Interns (Latihan Industri) do not fall under the classification of employees as outlined in the National Wages Consultative Council Act 2011.
