The minimum wage in Malaysia is RM1,700 a month under the Minimum Wages Order 2024. Since 1 August 2025, it has applied to employers of every size. Budget 2027, tabled on 9 October 2026, announced a rise to RM2,000 a month from June 2027. It also announced an exemption for micro, small and medium enterprises (MSMEs) with annual sales below RM50 million. The new rate applies only once a new Minimum Wages Order is made.
If you run a small Sdn Bhd and pay some staff at or near RM1,700, this guide is for you.
In short
- Today: RM1,700 a month, or RM8.72 an hour, for every covered employer, whatever its headcount.
- Announced: RM2,000 a month from June 2027. MSMEs with annual sales below RM50 million would be exempted.
- Status: a proposal until a new Minimum Wages Order is made. Nothing in your payroll changes today.
- One action now: list everyone you pay at or near RM1,700 and check their pay against the current Order.
What is the minimum wage in Malaysia now?
The Minimum Wages Order 2024 (P.U.(A) 376/2024) sets the current rates. The Minister of Human Resources made it under section 23 of the National Wages Consultative Council Act 2011 (Act 732). The Order was gazetted on 4 December 2024.
| Pay basis | Minimum rate |
|---|---|
| Monthly | RM1,700 |
| Daily, 6-day week | RM65.38 |
| Daily, 5-day week | RM78.46 |
| Daily, 4-day week | RM98.08 |
| Hourly | RM8.72 |
The rate started in two stages:
- 1 February 2025: employers with five or more employees. It also covered any employer carrying out a professional activity classified under the Malaysia Standard Classification of Occupations (MASCO), whatever its headcount.
- 1 August 2025: employers with fewer than five employees. From 1 February to 31 July 2025, their floor was RM1,500.
Staff paid only by piece rate, tonnage, task, trip or commission, with no basic wage, must still receive at least RM1,700 a month.
Exception: the Order does not apply to domestic servants as defined in the Employment Act 1955 and the Sabah and Sarawak Labour Ordinances.
What did Budget 2027 announce on the minimum wage?
Paragraph 32 of the Budget 2027 speech says the Government has decided to raise the minimum wage from RM1,700 to RM2,000 a month. The new rate would take effect from June 2027. The Government expects it to benefit more than four million workers.
It also sets out one exemption: “MSMEs with annual sales below 50 million ringgit will be exempted.” The stated reason is to leave room for businesses to adjust their models.
Is the RM2,000 minimum wage law yet?
No. A Budget speech announces policy. Minimum wage rates become binding through an order made under Act 732, which is how RM1,700 came into force. The RM2,000 rate applies once a new Minimum Wages Order appears in the Federal Gazette. That Order should also set out the exemption.
Until then, RM1,700 is the rate you pay. Before you change any contract, confirm the current requirement with the Labour Department or a licensed adviser. In Peninsular Malaysia that is JTKSM; in Sabah and Sarawak, it is the state Labour Department.
Will the RM2,000 rate apply to my company?
As announced, it depends on whether your company is an MSME and on its annual sales.
If your company is not an MSME, or has RM50 million or more in sales
What you pay: at least RM2,000 a month from June 2027, once the new Order is gazetted.
What to do: cost the rise for each affected employee now, using the checklist below.
If your company is an MSME with sales below RM50 million
What you pay: as announced, your company would be exempted from the new rate. The RM1,700 floor would still apply to you.
What to do: carry on paying at least RM1,700, and keep your annual sales figures to hand.
Say you run a trading Sdn Bhd with three warehouse assistants on RM1,700. With RM8 million in annual sales, your company would be exempted, as announced, and RM1,700 is your floor today. With RM60 million in sales, moving all three to RM2,000 from June 2027 would add RM900 a month in basic pay. EPF, SOCSO and EIS contributions come on top.
What is still unclear?
You can’t yet settle four points:
- How to count your annual sales: which financial year you use. On group sales, the Human Resources Minister said on 16 October that sales are counted across the group, with a subsidiary counted with its holding company. He also said exempted employers stay at RM1,700.
- Whether your company counts as an MSME: the national SME definition sets a lower sales line for services firms than for manufacturers. The speech doesn’t say which test applies.
- Your start day: June 2027, with no exact day yet.
- How long your exemption lasts: the Government has given no end date.
The new Order and any guidance from the Ministry of Human Resources should settle these.
What else in Budget 2027 affects employers?
Budget 2027 also proposed a RM2,500 monthly minimum for semi-skilled workers and graduates, a rule that companies other than MSMEs pay wages cashless to deduct them for tax from YA 2028, and the MediAsas medical plan. Our Budget 2027 guide covers each one.
What should I check in payroll now?
- Who is at or near RM1,700. List them with their basic pay and check each one against today’s Order. Include daily-rated and hourly-rated staff, and anyone paid only by commission.
- Pay that follows basic pay. Under the Employment Act 1955, you calculate overtime and rest-day pay from the ordinary rate of pay. So a higher basic wage lifts them too.
- Statutory contributions. EPF, SOCSO and EIS are calculated on wages, so a pay rise raises both the employer’s share and the employee’s deduction. If you are registered with HRD Corp, its levy rises too, on your side only.
- Your sales and headcount. Note annual sales and full-time staff for your last full financial year. Once the Government publishes the rules, you can test your company against the MSME definition and the RM50 million line.
- The June 2027 cost. If you are above the line or close to it, work out the gap to RM2,000 for each person, plus the employer contributions on it.
How Altomate handles this
Payroll in Altomate sits in the same account as your company records and secretarial work. You can run it two ways:
- You run it, in AltomateHR. The app is free for up to 3 employees and covers payroll calculation and payslips. The paid plan generates the statutory files for you to submit, and covers more than 3 employees.
- Altomate’s team runs it, on the Expert plan. We prepare the monthly statutory files and file them after you approve the payroll run. Nothing is submitted until you’ve signed off. Compliance updates, such as a new minimum wage rate, are part of Expert.
Both suit salaried teams on a standard monthly schedule. If most of your staff are hourly or shift-based, we will say so rather than sign you up.
Try AltomateHR free for up to 3 staff
Frequently asked questions
What is the minimum wage in Malaysia in 2026?
RM1,700 a month under the Minimum Wages Order 2024. It has applied to employers of every size since 1 August 2025, with domestic servants excluded. Budget 2027 announced RM2,000 for June 2027, exempting MSMEs below RM50 million in annual sales, but it is not law yet.
What is the minimum wage per hour in Malaysia?
RM8.72 an hour under the 2024 Order. The daily rates are RM65.38 for a 6-day week, RM78.46 for a 5-day week and RM98.08 for a 4-day week.
When does the RM2,000 minimum wage start?
The Budget 2027 speech says June 2027, with no exact day. It applies once a new Minimum Wages Order is gazetted, and that Order should give the date.
Is my SME exempt from the RM2,000 minimum wage?
As announced, MSMEs with annual sales below RM50 million would be exempted. The Government has not yet said how it will count sales or how long the exemption lasts. Today’s RM1,700 still applies to you.
Sources
- Budget 2027 speech, English translation (the Bahasa Malaysia version prevails), Ministry of Finance, 9 October 2026, paras 32, 33 and 86: https://belanjawan.mof.gov.my/pdf/belanjawan2027/ucapan/bs27.pdf
- Minimum Wages Order 2024, P.U.(A) 376/2024, Federal Government Gazette, 4 December 2024 (copy published by the Ministry of Human Resources): https://gajiminimum.mohr.gov.my/wp-content/uploads/PUA%20376.pdf
- Ministry of Human Resources media statement on the Minimum Wages Order 2024, 31 January 2025 (in Bahasa Malaysia): https://www.mohr.gov.my/images/pdf/JLD4%20(19)%20KENYATAAN%20MEDIA%20KESUMA_Pelaksanaan%20Perintah%20Gaji%20Minimum%20RM1700%20Sebulan.pdf
