Summary
This Policy Brief presents an overview of the three main limitations of the current wage system become the major stumbling blocks in pushing for a fair and reasonable wage in Malaysia.
First, there is a concern to address the wage stagnation among middle-wage earners, particularly semi-skilled workers. The implementation of a progressive wage model holds immense potential for uplifting the wages of semi-skilled workers
Second, there is a limited application of profit-sharing model for the variable wage components (e.g. allowances and performance-based incentives) in the total remuneration. The development of a guideline could better facilitate the adoption of a profit-sharing model in any company according to its capability.
Third, the current wage governance body is mandated to the minimum wage and thus it has limitations in addressing the issue of wages from a holistic perspective. Therefore, there is a need to have a governance body that monitors the overall wage ecosystem for a fair distribution of wealth and increases the productivity of overall workers.
