The minimum wage will be raised to RM1,200 starting January 2020 but will be limited to workers in major cities in the country. Finance Minister Lim Guan Eng made the announcement when tabling the Budget 2020 at the Dewan Rakyat today. He said this was part of a drive to modernise the labour market.
Other steps include increasing maternity leave to 90 days from the current 60 days. This will start in 2021. The government will also make compulsory overtime pay for workers who earn RM4,000 and below.
The government said under the new Budget, it plans to extend and strengthen workers’ rights, including extending private pension coverage for contract labourers. The policy will be limited to the entertainment industry first as a pilot project, but Putrajaya expects to expand this to other sectors soon.
The government also handed out fresh assistance and incentives to the 1.6 million-strong civil service under Budget 2020. Lim announced a RM50 increase in living cost allowance (COLA) and also promised to pay backdated leave to civil servants with 15 years of service. The government has also decided to give out ex-gratia payments to the next of kin of dead civil servants, a sum of up to RM150,000.
In addition, the government would give special assistance worth RM500 to civil servants Grade 56 and below. Retirees will receive RM250. Both payments are expected to be disbursed by year-end.