KUALA LUMPUR: The minimum wage implementation has no direct impact on the retrenchment rate in Malaysia, the Dewan Negara was told today.
Deputy Human Resources Minister Datuk Seri Ismail Muttalib said based on 92,566 checks carried out by the ministry so far, it was revealed that 91,316 or 99 per cent of the employers here abide by the minimum wage ruling.
Following this, he said the ministry was confident that the employers would abide by the new minimum wage ruling of RM1,000 for Peninsular Malaysia (up from RM900) and RM920 for Sabah, Sarawak and Labuan (up from RM800) which would take effect next month.
He said employers should not view the minimum wage increase negatively as higher wages would motivate workers and help improve productivity which would benefit the companies.
"The implementation of the minimum wage does not have a direct impact on the retrenchment rate in Malaysia. Retrenchments are more likely to be caused by the rising cost of material and global market competition," he said in reply to a question by Engku Naimah Engku Taib.
He said a total of 33,086 workers were retrenched (including through voluntary separation scheme) in 2013; 25,917 in 2014; 38,459 in 2015; and 6,534 workers retrenched so far this year.