Small firms urged to offer competitive wages despite minimum wage exemption

Small and medium-sized enterprises (SMEs) have been excluded from the latest minimum wage hike, but industry representatives are urging firms in this category to voluntarily offer competitive salaries to maintain their workforce quality.

Samenta William Ng, president of a business federation representing small enterprises, said the exemption recognises the financial constraints faced by smaller operators. However, he stressed that competitive remuneration remains crucial for companies seeking to attract and retain their best employees and most dedicated staff members.

The remarks come as Malaysia continues adjusting its wage policies to balance employer capabilities with worker welfare. The minimum wage increase, while not applying to SMEs, reflects broader efforts to improve living standards for workers in larger enterprises.

Business analysts suggest that while the exemption provides relief for smaller companies managing tighter margins, those that invest in competitive wages may gain competitive advantages through improved employee retention, productivity, and loyalty. Ng's position reflects a broader industry consensus that voluntary wage improvements, even when not mandated, can benefit both workers and SME sustainability in the long term.