Press Release

29 April 2016 – Minimum Wages Order 2016
       
The review of Minimum Wages Order (MWO) 2012 has been completed by the National Wages Consultative Council (NWCC) and the outcome has been agreed by the Cabinet. During the 2016 Budget Speech on 23 October 2015, the Honourable Prime Minister has announced the new minimum wages rates which was subsequently gazetted in the MWO 2016. When setting the new minimum wages, the Government has taken into considerations all the proposed recommendations by NWCC, adopted a balanced approach as well as considered the interest of both employers and employees. The gazetted MWO 2016 implies that the Government is committed in protecting the interest of employees besides not neglecting the interest of employers.
       
2. The main features in the Minimum Wages Order (MWO) 2016 are as below:
       
  2.1 Commencement Date
    The commencement date of MWO 2016 is 1 July 2016 and it applies to all employers regardless of the number of employees.
       
  2.2 Minimum Wages Coverage
    MWO 2016 covers all employees in the private sector except domestic servants.  
       
  2.3  Monthly/Hourly Minimum Wages Rates
    Minimum wages rates are set by regions where the rates for Peninsular Malaysia is RM1,000 monthly/ RM4.81 hourly and RM920 monthly/ RM4.42 hourly for Sabah, Sarawak and Federal Territory of Labuan.
       
  2.4 Daily Minimum Wages Rates
    The daily minimum wages rates are inserted in the MWO 2016 subject to a maximum of 48 hours of total working hours a week as below:
       
   

Regional Area

No. of Working Days in a Week

Daily Minimum Wages Rates

Peninsular Malaysia

6

RM38.46

5

RM46.15

4

RM57.69

Sabah, Sarawak and Federal Territory of Labuan

6

RM35.38

5

RM42.46

4

RM53.08

       
  2.5 Minimum Wages for Employees Paid Based on Piece-rate, Tonnage, Task, Trip or Commission
    For employees not paid basic wages but paid based solely on piece-rate, tonnage, task, trip or commission, the monthly wages rate to be paid to employees should not be less than RM1,000 in Peninsular Malaysia or RM920 in Sabah, Sarawak and Federal Territory of Labuan.
  2.6



Removal of Clauses Related to Application for Deferment, Negotiation on Restructuring of Wages and Minimum Wages Rates for Employees under Probation Period    

    The clauses on application for deferment, negotiation for restructuring of wages and minimum wages rates for employees under probation period in the MWO 2012 are no longer available in MWO 2016. For employees who are still under probation period after 1 July 2016, there is no more reduction of minimum wages rates for these employees starting 1 July 2016.
       
3. Termination of the Guidelines of the Implementation of the Minimum Wages Order 2012
  The Guidelines of the Implementation of the Minimum Wages Order 2012 produced by the National Wages Consultative Council on 6 September 2012 in line with the enforcement of MWO 2012 is terminated with the commencement of MWO 2016 on 1 July 2016.
       
4. Conclusion
  Department of Labour will continue to strengthen their enforcement to ensure employers pay minimum wages. The Government aspires that the new minimum wages rates will increase employees’ income as well as uplift the country’s economy in achieving High Income Nation by 2020. A copy of the Order is available at the Ministry of Human Resources’ website via www.mohr.gov.my.
   
Minister of Human Resources
29 April 2016
       
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