The Prime Minister YAB Datuk Seri Najib Abdul Razak announced the rates of national minimum wages on 30th April 2012. The minimum wages shall be as follows: 

Minimum wages under the National Minimum Wages Consultative Act 2011 is defined as basic wages determined under Section 23 of the Act. However, for the purposes of implementing minimum wages, payments in cash and cash incentives paid to the employees, the definition of wages under Section 2 of the Employment Act 1955 may be converted to be part of the minimum basic wages.

In determining what allowances that may be converted into basic wages, members should be guided by the Industrial Court Award in the case of Rothmans of Pall Mall (Malaysia) Bhd. v. Rothmans Employees’ Union (Award 97 of 1996) (a copy of the Award No. 97/96 is enclosed) where the Court decided that the following allowances are within the definition as wages under Section 2 of the Employment Act 1955:

(Please note that the above list is not exhaustive and may include other cash allowances and incentive payments)

Members are also advised that travelling allowance is not part of wages, under the definition of wages under Section 2 of the Employment Act 1955. However, employers may with the consent of the employees convert the said travelling allowance to be part of basic minimum wages.

The implementation of minimum wages would only take effect 6 months (12 months for micro enterprises) from the date the Order is gazetted by the Minister of Human Resources.

In the event an employer is unable to implement the minimum wages within the time frame as stated above, the employer may apply to the National Wages Consultative Council (NWCC) within 6 months from the date of gazette to review the implementation date of the minimum wages . Hotels may convert part or all of the service charges to be part of basic salary in order to arrive at the minimum wages of RM900.00/RM800.00.

For the plantation industry, the RM200.00 which was paid as part of gratuitous payment may be converted as part of the minimum wages requirement. Those exempted from the ruling on minimum wages include Trainees, Apprentices, and Domestic Servants.

Foreign workers legally working in the country shall be covered by the minimum wages requirement. Further advice on the above will be issued from time to time especially when the Minister of Human Resources gazettes the Order on National Minimum Wages.

Source: Malaysian Employers Federation