Minimum Wages Order 2016

Hi readers,

With effect July 2016, the Minimum Wages Order 2016 will come into play. This means that apart from the rates being increased from RM900 to RM1000 for Peninsular Malaysia, you need to be aware of the following other changes:

  1. In 2012, domestic servants and apprentices were excluded from the application of minimum wage but now in 2016, only domestic servants are excluded.
  2. In 2012, employees can be paid  a reduced minimum wage of up to 30% during their first six months of if they are on probation. Employers were then obliged to move it up to the minimum wage after 6 months whether the employee is confirmed or otherwise. This reduction is no longer permitted from July 2016 onwards.
  3. The 2016 order does not specifically mention rules for restructuring into a clean wage – this could mean 2 things, firstly that restructuring of wages is no longer permitted or secondly, restructuring of wages is now allowed without restrictions imposed in 2012.

I believe these slight changes would not affect you big time but please reach out if help is needed.