Implementation of Minimum Wages Policies in Malysia

In Malaysia, in the private sectors, the wages of an employee had always been a matter of consensus between an employer and an employee depending on the elasticity of demand and supply in the labor market. It is not subjected to any government or legislative intervention, thought de facto minimum wage may exist as a result of custom and extra-legal pressure from unions. This matter which may be agrees upon between employer and the employee. However, the Parliament had recently passed new laws to impose the minimum wages of an employee. Background to Minimum Wages in Malaysia The National Minimum Wages initiative for Malaysia was announced by the Prime Minister in his Budget Speech on 15 October 2010. It is one of the†¦show more content†¦Reductions in Training. Another channel of adjustment consistent with the competitive framework is the possibility that employers might reduce their expenditures on job training for low-wage workers. Reductions in Non-Wage Benefits. Within the competitive framework, employers might respond to a minimum-wage increase by lowering the value of non-wage benefits, such as health insurance and pension contributions. Changes in Employment Composition. Employers may adjust to a higher minimum wage by upgrading the skill level of their workforce, rather than cutting the level of their staffing. This process could conceivably work against the employment prospects of less-educated and less-experienced workers, especially, the argument goes, school-problems teens. Higher Prices. Employers may respond to a higher minimum wage by passing on the added costs to consumers in the form of higher prices. In a purely competitive economy, where all firms are experiencing the same increase in labor costs in response to a minimum-wage increase, economic theory predicts that at least a portion of the cost increase will be passed through to consumers. Improvements in Efficiency. The institutional model of the labor market suggests that employers may respond to a minimum-wage increase with efforts to improve operational efficiency including tighter human resource practices..., increased performance standardsShow MoreRelatedSingapore MACRO environment3115 Words   |  13 Pagespolitical stability were maintained by the paternal guidance of the PAP. Therefore, Singapore is not administered by politicians, but by bureaucrats, in a meritocracy where power is gained through skill, performance, and loyalty to the nation and its policies. Dominance of government-controlled companies exists in the local economy. However, in spite of its powerful position, the Singapore government has maintained a clean, corruption-free image. Conflicts within the leadership in Singapore are rare