New minimum wage: MEF calls for salary adjustments for higher positions

SHAH ALAM – Employers in Malaysia may consider increasing salaries for higher positions following the implementation of the RM1,700 minimum wage, which took effect last Saturday.

Malaysian Employers Federation (MEF) president Datuk Dr Syed Hussain Syed Husman said this adjustment was necessary to maintain the wage gap between the lowest-paid workers and those in higher categories.

This, he said was to ensure internal equity and fairness within organisations while maintaining industrial harmony in the workplace.

"By maintaining internal equity, companies can address potential wage gaps and uphold a structured and fair compensation framework. This reflects the various levels of responsibility and expertise across different roles.

"In principle, wages should not be solely based on education level but should also consider other factors such as work experience, skills, performance and industry needs.

"Formal education provides theoretical foundations and certain essential skills in fields such as medicine, engineering and law.

"However, not all jobs require academic qualifications to be performed efficiently," he told Sinar.

On Friday, the Malaysian Trades Union Congress emphasised in a statement that workers with at least the Sijil Pelajaran Malaysia (SPM) qualification and skills should be paid above the minimum wage rate.

It stated that employees with an SPM qualification should have a wage higher than the minimum wage, while those with skills certificates and diplomas should receive salaries that fairly match their technical and professional expertise.

Meanwhile, graduates with a bachelor's degrees and those in engineering fields should be paid significantly higher salaries to sufficiently recognise their expertise and contributions to the industry.

Syed Hussain said the MEF Salary Survey for Executives and Non-Executives 2024 revealed that the majority of basic monthly salaries exceeded RM1,700, which was higher than the minimum wage effective Feb 1, 2025, except for workers with only a PMR (Penilaian Menengah Rendah) qualification.

Flexible Salaries

As such, MEF encouraged workers with lower qualifications to upgrade their skills through continuous learning.

At the same time, he emphasised that a flexible and merit-based salary structure was more suitable to ensure fairness, enhance workforce competitiveness, improve business sustainability and strengthen employers' and the country's overall competitiveness.

"Performance and productivity-based salary schemes ensure that those who make significant contributions to employers are rewarded accordingly.

"Salaries should consider various factors such as education, experience, skills, performance and market demand," he said.

He added that technical skills such as programming, design and data analysis, as well as soft skills like leadership, communication and critical thinking played a crucial role in determining work performance.

"Employers are willing to pay higher wages to employees with high-impact skills," he said.

A total of 4.37 million workers were expected to receive the RM1,700 minimum wage per month, compared to the previous RM1,500.

However, the Human Resources Ministry has emphasised that the minimum wage should not be used as a benchmark for entry-level salaries, especially for graduates.

Employees, it stated, should be paid fairly based on their skill sets.

In December, 17 trade unions and two non-governmental organisations urged the government to add a new section called "wage adjustment" in the Minimum Wage Order.

Each time the minimum wage increased, the salaries of employees earning more than the minimum wage but below the upper threshold of the B40 group (RM5,250) should be raised by the same percentage as the minimum wage increase.

For example, if the current minimum wage of RM1,500 increased by RM200 (13.3 per cent) to RM1,700 in 2025, workers earning between RM1,500 and RM5,250 should also be entitled to a 13.3 per cent salary increase.

After the salary adjustment, a senior employee earning RM1,600 would see their salary increase to RM1,813.

Among the signatories to the statement included the National Union of Transport Equipment and Allied Industry Workers, Sabah Hotel, Resort and Restaurant Employees Union, the Malayan Nurses Union and Tenaganita.

INFO – Minimum basic salary for new workers in 2024

PMR – Basic salary: RM1,582, Gross income: RM1,782

SPM – Basic salary: RM1,672, Gross income: RM1,888

STPM – Basic salary: RM1,790, Gross income: RM1,970

SKM Level I – Basic salary: RM1,749, Gross income: RM2,154

SKM Level II – Basic salary: RM1,787, Gross income: RM2,218

SKM Level III – Basic salary: RM1,859, Gross income: RM2,285

SKM Level IV – Basic salary: RM1,996, Gross income: RM2,465

SKM Level V – Basic salary: RM2,164, Gross income: RM2,619

Diploma – Basic salary: RM2,150, Gross income: RM2,381

Bachelor's Degree – Basic salary: RM2,972, Gross income: RM3,315

Master's Degree – Basic salary: RM3,779, Gross income: RM4,232