KUALA LUMPUR: The Human Resources Ministry has clarified that the new RM1,700 minimum wage set to be implemented next year was chosen based on proper procedures.
Its minister, Steven Sim, said the adjustment to the minimum wage was made through processes, procedures, and relevant laws under the National Wage Consultative Council 2011 Act.
"The minimum wage increase, effective from February 2024, is not a figure plucked from Pak Belalang's magic pot; there are processes, procedures and laws involved.
"The National Wage Consultative Council Act mandates that the minimum wage rate be reviewed and set once every two years," he said in his winding up speech for the 2025 Budget today.
Sim explained that the first step involved the Minimum Wage Order (PGM) study from October 2022 to November 2023.
"This study involved a total of 3,849 respondents, comprising 1,911 employers and 1,930 employees.
"The study was conducted to gather and analyse data and information, to research wages and socio-economic indicators, and to gather feedback on the impact of the implementation of the 2022 PGM.
"The results of this survey were analysed and used as input for the PGM review," he said.
He added that the National Minimum Wage Consultative Council's technical committee also conducted 26 engagement sessions nationwide, involving 1,109 participants from employer associations and industry representatives.
"In addition, opinions were also obtained from federal government agencies, state governments, and wage experts, including international experts such as regional wage specialists from the International Labour Organisation (ILO).
"We received a total of 61 opinions and recommendations from 36 memorandums submitted by employer and employee representatives who were unable to participate in the engagement sessions.
"These memorandums were submitted through the Human Resources Ministry's website," he said.
He added that the RM1,700 wage recommendation was reached unanimously by the National Wage Consultative Council, which comprises representatives from the government, employers, and employees.
"This minimum wage rate will be implemented uniformly across all regions and sectors, without differentiation by sector, as the ILO discourages complex wage structures, which could complicate information delivery and cause confusion and conflict.
"The ILO recommends that member states implement a minimum wage system that is straightforward and easy to administer," he said.