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Raise minimum wage only for M'sian workers, Guan Eng urges govt
Bagan MP Lim Guan Eng has urged the government to ensure that any new minimum wage increase applies only to Malaysian workers, warning that extending it to foreign employees would further raise business costs.
Speaking at a press conference in Parliament today, he said employers, particularly small and medium enterprises (SMEs), were already concerned about rising labour costs.
“Make sure it's only for Malaysian workers, not for foreign workers. Because...
Bagan MP Lim Guan Eng has urged the government to ensure that any new minimum wage increase applies only to Malaysian workers, warning that extending it to foreign employees would further raise business costs.
Speaking at a press conference in Parliament today, he said employers, particularly small and medium enterprises (SMEs), were already concerned about rising labour costs.
“Make sure it's only for Malaysian workers, not for foreign workers. Because you only increase the burden.
“And lately I've received many calls from many employers that are worried,” said the former finance minister.
His remarks come ahead of an expected minimum wage increase under Budget 2027, which will be tabled in the Dewan Rakyat on Oct 9.
/file/attachments/orphans/parlimenmalaysia12_383166.png "Parliament sitting 5h October 2026 Persidangan Dewan Rakyat 501026")
Human Resources Minister R Ramanan said on Sept 29 that the government had yet to decide on a new rate, dismissing speculation that it could be RM2,000-RM2,200.
Lim rejected suggestions that excluding foreign workers from a future increase could encourage employers to hire more migrant workers, including undocumented migrants.
He said employers would prefer to hire Malaysians at higher wages if enough local workers were available.
“So, if they can get local workers for, let's say, RM2,500, I'm sure they are more than happy to have that. But you can't get them.
“And then suddenly you increase for foreign workers. I think that is unconscionable... for us (Malaysians), okay, but not foreign workers," he said.
Wage pressures
On Sept 30, Entrepreneur Development and Cooperatives Minister Steven Sim (below) said the cabinet had agreed that workers’ wages should continue to rise, but micro, small, and medium enterprises would be exempted from the new minimum wage increase for the time being.
Lim, however, questioned how long the exemption would last.
“Even though you say (there is an) exemption for SMEs, but we do not know how long that moratorium will last.
“So, it's only a matter of time before we have to follow suit. So, if that happens, businesses, Malaysian businesses will be severely jeopardised,” he said.
/file/publisher-c1a3f893382d2b2f8a9aa22a654d9c97/2025/08/de4d14cc6fc14fb35edf5b5c79395693.jpg "Human Resource Minister Steven Sim at parliament 210825")
The existing RM1,700 monthly minimum wage took effect for employers with five or more workers on Feb 1, 2025, before being extended to all employers from Aug 1.
It also applies to non-citizen private-sector workers, except domestic workers.
The government has maintained that excluding foreign workers would amount to nationality-based discrimination and run contrary to existing labour laws.
Lim argued, however, that employers already incur substantial additional costs when hiring migrant workers.
“If you look at the nominal rate that is paid to foreign workers, the actual rate is actually RM1,000 more.
“Because of all the levies, all the costs associated with looking after their health, their housing minimum standards, and all that.
“This is really a heavy burden for SMEs,” he said.
EPF exemption proposal
Lim also renewed his call for employers and foreign workers to be exempted from the mandatory two percent Employees Provident Fund contribution.
He made a similar proposal in the Dewan Rakyat in August 2025 while debating the 13th Malaysia Plan, arguing that existing migrant workers should not be subjected to either the RM1,700 minimum wage or mandatory EPF contributions because they had been recruited under earlier employment terms.
Sim, who was then human resources minister, rejected the proposal, arguing that equal minimum wages were necessary on human rights grounds and to prevent cheaper migrant labour from depressing local wages.
Migrant rights group Tenaganita also criticised Lim’s remarks, warning that excluding migrant workers from minimum wage protections could legitimise exploitative employment practices.
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Yes fully agreed. Foreign workers and employers. Not our government. Also for domestic maids, where all needs are taken care of: accommodation, food etc, why are they categorized as other foreign workers who pay for their accommodation and meals. Normally, employers provide more than the stipulated pay. Overtime, meals etc to complete work. Foreign workers get more than minimum pay because employers need them. So no need for government to stipulate. Plus other costs are involved. Let not foreign workers cause inflation here.
Appalling proposal from LGE. This is not only discriminatory but contravenes Malaysia's labour and human rights obligations. This must never be accepted
Workers of the World Unite! All workers are workers doing same work, same value. Wage increase must apply to all workers. As it is the employers prefer undocumented workers so they can pay them lesser. Guan Eng do not oppress workers and support exploitative greedy employers. Fight for dignity of work irrespective of nationality.
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