World Bank proposals factored into minimum range

PETALING JAYA: Datuk Seri Najib Tun Razak said the recently-announced national minimum wage was justified and had taken into consideration factors proposed by the World Bank.

Set at RM900 (RM4.33 per hour) for employees in the peninsula and RM800 (RM3.85 per hour) for workers in Sarawak, Sabah and Labuan, the minimum wage has received mixed reactions from workers.

“In principle, I am clear this is the right thing to do,” wrote the Prime Minister on his blog

“The minimum range was decided after taking into consideration several factors as proposed by the World Bank such as cost of living, poverty line index and unemployment rate,” he said, adding that it will be reviewed every two years.

Najib said the Government had to carefully consider striking a balance between “guaranteeing workers a decent wage” and “encouraging employers to hire workers”.

“Some international studies indicate that a higher minimum wage can potentially affect demand for workers, especially youths lacking experience,” he wrote.

Najib, however, said the Government had identified measures to ensure a smooth transition towards implementing the new floor wage.

“I'm confident that this new policy will benefit many workers across the country,'' he added.