Table of Content

Statement Introduction Report Findings References Appendix

3 4-5 6 7

Human Resource Management

Statement The minimum wage policy is aims to improve the economic wellbeing of workers in Malaysia. However the implementation may threaten companies especially those in the Small and Medium Industries. Few companies have request postponement of its implementation.

Introduction The minimum wage can be defined as the minimum amount of compensation an employee must receive for performing labor. According to Investopedia, Minimum wages are typically established by contract or legislation by the government. As such, it is illegal to pay an employee less than the minimum wage. Here in Malaysia, the government has officially adopted a minimum wage on January 1, 2013, thus joining more than 150 other countries that have implemented the minimum wage law. This policy aims to ensure that the basic needs of workers and their families are met, to reward and protect them from exploitation, and encourage firms to move higher up the value chain by investing in technology and enhance productivity. Through this policy, the minimum wage set at RM900 per month (RM4.33 per hour) for Peninsular Malaysia and RM800 (RM3.85 per hour) for Sabah, Sarawak and the Federal Territory of Labuan, which includes local and foreign labor, except domestic servants as assistant and home gardeners. The following formula are for full-time employees who are paid on a daily basis and have been attend on ordinary working days Daily wage rate = Monthly Minimum Wage rate x 12 months 52 Weeks x Number of Working Days in a week

It is estimated that about 27% of employees in the country will benefit from a minimum wage policy. On average, workers in Peninsular Malaysia were expected to receive a salary increase of 33%, while the East Malaysian workers received an increase of 38%. By economic sector, agriculture is expected to receive the highest salary hike for 43% of workers in the sector receive wages lower than the minimum wage before they are implemented.

Report Finding
The following are the finding of the survey which was conducted only for one respondent or employee only. The researcher chose a local small company which focus on manufacturing sector for local product. Respondent Background The survey was conducted for one employee only where the respondent work in small industry. The respondent works in manufacturing sector which specialize in Batik making in Noor Arfas Melaka Batik House. The respondent is a local Malay woman work as an event coordinator which she receives wage more than RM900 for her service in two years. Findings The findings are based from the set of questionnaire that has been design for the researcher and no any additional question in the questionnaire. The respondent is aware of the national minimum wages policy and her company already implements the policy. Based on a survey conducted, many employees are satisfied with the policy of minimum wage act which was introduced by the Government of Malaysia. Their opinion on this act was, it would help them reduce the burden from their income. Besides that through this act, the employer will get benefit where employers would be given tax exceptional. There are lots of benefit can be earned by the employee through this act. First, through this act the government can help the workers who are paid under RM900. Second, through this act, workers would be able to have more income and can help to improve their living standards. At this time all the basic necessities coupled with increased of transportation costs, costs of services, which include water and electricity increasing, so with the minimum wage it will help the workers to live without burden in these days. Apart from that, based from the minimum wage it will help the workers get the overtime pay more than the usual. For example, when the basic salary has increased the wages

for overtime pay will increase and thus can enhance an employee's income. Wages for working on holiday time will also increase. From this survey, it is also can be interpreted from the employer side. When the employer implements the minimum wage policy, the government will provide tax relief to small companies. Apart from that the company can improve the productivity through the minimum wage policy where the workers will perform their work more enthusiastically because their income has increased. The government also would receive benefit from this policy as it can encourage the economic growth in the country. Through this policy, the workers who have had an increase in revenue will be able to spend more for their needs and in this way the flow of money will increase in market. Thus the economy will continue to grow rapidly. With the existence of this policy, it can be seen that the government's concern for workers with low incomes. Conclusion In conclusion this policy of minimum wage is really good for the sake of employee in Malaysia if all the company in no matter small or medium industry implement it. This policy will help all employers and employees in the country. It is hoped that the wages for the employee can be improved in future.

References Laporan Tahunan 2012, Prospek Dan Dasar Pada Tahun 2013 http://www.investopedia.com/terms/m/minimum_wage.asp Garis Panduan, Majlis Perundangan Gaji Negara Mengenai Kaedah Pelaksanaan Gaji Minimum 2012 Employment Effects of The Minimum Wage, Daniel Aaronson, Erich French http://www.jstor.org/discover/10.1086/508734?uid=3738672&uid=2&uid=4&sid=211021 34172881

Appendix