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  • Writer's pictureBait Al-Amanah

Progressive Wage - Should annual salary increment be mandatory?

The Malaysian government seeks to introduce a progressive wage policy to accelerate salary growth. This initiative aims to stimulate the labour market while providing increased assistance to address the declining proportion of wages in the economy. While this move is a noble move, making it mandatory will lead to several unintended consequences which Benedict Weerasena (Research Director of Bait Al Amanah) expounded on in a recent interview by Astro Awani.

Most recently after the interview, our Prime Minister Anwar Ibrahim announced that the progressive wage policy will be voluntary in nature, incentive-based and productivity-linked. This is indeed a wise move instead of making it mandatory. We also applaud the efforts to hold further discussions and engagement sessions with key stakeholders, especially industry players, businesses and employees to finetune the bill.

For the interview, refer to the link from Astro Awani:

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