Malaysia’s economy is constantly evolving, and minimum wage updates play a key role in ensuring fair pay while keeping businesses competitive. Staying compliant isn’t just about following the rules—it’s about growing alongside the economy, supporting your workforce, and building a business that thrives.
Here’s what you need to know about the RM1,700 minimum wage update, how it applies to your business, and why compliance matters.
What’s the Minimum Wage in Malaysia?
The minimum wage in Malaysia is now RM1,700 per month across both Peninsular Malaysia and East Malaysia. If you pay employees daily or hourly, here’s how it breaks down:
Employment Type | Minimum Wage |
Monthly | RM1,700 |
Daily (based on 26 working days) | RM65.38 |
Hourly | RM8.72 |
When Does the New Minimum Wage Apply?
The Minimum Wages Order 2024 (MWO 2024) introduces the RM1,700 wage in two phases:
From 1st February 2025:
Employers with five or more employees must pay RM1,700.
Employers engaged in professional activities under MASCO 2020 must comply, even if they have fewer than five employees.
From 1st August 2025:
All employers, regardless of company size, must implement the RM1,700 minimum wage.
If you have fewer than five employees (excluding MASCO Employers), you could continue to pay less than RM 1,700 until 1st August 2025.
History of Minimum Wage in Malaysia
Malaysia’s minimum wage has changed over the years to keep up with inflation and improve living standards. Here’s a quick recap:
Year | Minimum Wage (Peninsular Malaysia) | Minimum Wage (East Malaysia) |
2013 | RM900 | RM800 |
2016 | RM1,000 | RM920 |
2019 | RM1,100 | RM1,100 |
2020 | RM1,200 (major cities) | RM1,100 |
2022 | RM1,500 | RM1,500 |
2025 | RM1,700 | RM1,700 |
Each adjustment aims to balance economic growth with fair compensation for workers.
Does the Minimum Wage Apply to Everyone?
Not sure if your employees fall under the new wage structure? Here’s a breakdown:
Employment Type | Does Minimum Wage Apply? |
Full-time employees | Yes, must be paid RM1,700 |
Part-time employees | Yes, based on pro-rated hours |
Freelancers & contract workers | No, unless under "contract of service" |
Domestic Worker | No |
Interns | No |
Penalties for Non-Compliance
Ignoring minimum wage laws isn’t worth the risk. Employers who fail to comply may face serious consequences, including:
Offense | Penalty |
First Offense | A fine of up to RM10,000 per employee, plus the court may require the employer to pay the difference between the minimum wage and the employee’s basic wage. |
General Penalty | A fine of up to RM10,000 for each violation. |
Penalty for Continued Offense | A daily fine of up to RM1,000 for continuing the offense after a conviction. |
Penalty for Repeated Offense | A fine of up to RM20,000 or imprisonment for up to 5 years. |
Beyond fines and legal action, non-compliance can damage your company’s reputation and make it harder to attract and retain employees.
Can employers include allowances in the minimum wage calculation?
No—allowances (like transport or meal allowances) cannot be used to meet the minimum wage requirement. The base salary itself must be at least RM1,700.
Stay Compliant, Stay Competitive
Staying on top of Malaysia’s wage regulations is key to building a sustainable, forward-thinking business. Ensuring fair wages keeps your workforce motivated, enhances retention, and strengthens your company’s reputation.
At Synergy Outsourcing, we help businesses like yours navigate HR and payroll compliance effortlessly. From structuring competitive salary packages to ensuring full compliance with wage laws, we’ve got your back.
Feel free to reach out to our team 📞+6 010-277 0718 or 📩 info@synergy-outsourcing.com.
