Employers who fail to comply with the minimum wage will be fined up to RM10,000.
The minimum wage of RM1,500 will be implemented from May 1, 2022 and employers who employ 5 or more employees will be required to pay a minimum wage of RM1,500 for their employees. Employers with less than 5 employees will be exempted from the RM1,500 minimum wage until January 1, 2023.
Employers in industries classified as professionals by the Malaysian Occupational Classification Standard (MASCO) will be required to pay the RM1,500 minimum wage regardless of the number of employees employed.
The minimum salary of RM1,500 is the basic salary, i.e. it does not include allowances and overtime. If the employee’s salary is hourly, the minimum hourly rate is RM7.21 cents per hour. If the employee is paid on a daily basis, the daily rate is RM57.69 sen for a 6 day work week, RM69.23 sen for a 5 day work week and RM86.54 sen for a 4 day work week.
Any employer who violates the RM1,500 minimum wage system will be in breach of Section 43 of the National Salaries Advisory Council Act 2011 and will be liable to a fine of up to RM10,000, which will be calculated based on the number of employees. Repeat offenders will be liable to a fine of up to RM20,000, imprisonment for a term not exceeding 5 years or the court may order the employer to pay the difference between the minimum salary and the basic salary and other costs.
