PUTRAJAYA, Malaysia - The minimum wage for private sector employees has been set at between RM800 (S$327) and RM900 per month.
The RM900 or RM4.33 per hour is for employees in the peninsula while the RM800 or RM3.85 per hour is for workers in Sarawak, Sabah and the Federal Territory of Labuan.
It covers employees in all economic sectors except those in the domestic service sector such as maids and gardeners.
The much anticipated minimum wage was announced by Datuk Seri Najib Tun Razak at a special gathering of several thousand private sector employees at the Putrajaya International Convention Centre here last night.
"This is a special present from the Federal Government to all employees of our beloved country," he said to thunderous applause from the audience.
The rates will take effect six months from the date the Minimum Wage Order (Perintah Gaji Minimum) is gazetted.
However, the effective date for small-time employers or micro enterprises had been extended by another six months to give them time to make preparations so their businesses would not be affected, Najib said.
He added that the 12-month grace period did not cover professional outfits such as dental and medical clinics and legal, architecture and consultant firms.
Even if they had five employees or fewer, they were required to implement the minimum wage within six months of the order being gazetted, he said.
Najib said the Government was providing a flexible implementation mechanism so that employers who are really unable to implement the minimum wage could appeal for an extension.
"We have also prepared a mechanism whereby some allowances or fixed cash payments are allowed to be absorbed in the calculation for minimum wage," he said.
Najib noted that employees had demanded a minimum wage of between RM1,200 and RM1,500 but said this could not be implemented.
On the recommendation of the National Wage Consultative Council and based on a World Bank study, the minimum wage could not be set too high, he said.
Najib said the discussions of the council, representing the Government, employers and employees, had at times been heated but a consensus was achieved "in the spirit of tripartite".
The Government had agreed to the council's recommendations with minor adjustments, Najib said.
Najib added that different minimum wages for the peninsula and Sarawak, Sabah and Labuan were due to the variation in wage structures and cost of living.
"However, the Government hopes that within the next two to three years, the minimum wage for Sabah, Sarawak and Labuan can be streamlined with that of the peninsula."