PETALING JAYA: Lack of awareness and incentives on the progressive wage policy (PWP) are among the main reasons why it remains unattractive to bosses, says the Malaysian Employers Federation (MEF).

Its executive director Datuk Shamsuddin Bardan (pic) said 60% of companies involved in the latest survey conducted by MEF on PWP admitted that they have limited awareness of various aspects of the policy.

“Only 11% of companies considered the incentives offered as being attractive, while 38% responded no, and the remaining 51% were uncertain,” he said during the release of MEF’s latest survey yesterday.

Only five companies or 2% of the 262 that participated in the survey had applied for the pilot PWP that was held last June until August, he added.

Shamsuddin also said the recent allocation of RM200mil announced by the Prime Minister would only benefit about 60,000 employees, while the Malaysian workforce comprises about 4.5 million people.

“We try to work together with the government on how employers can actually be incentivised to participate in the programme.

“I would say that the lukewarm response to the pilot programme can be addressed when we roll out the plan to a bigger audience,” he added.

During the Budget 2025 announcement, Datuk Seri Anwar Ibrahim said that following the pilot programme for the PWP in June, it will be fully implemented next year, with a budget of RM200mil benefiting 50,000 workers.

Shamsuddin said MEF is of the opinion that the policy should not be made compulsory.

“It is not feasible for it to be made mandatory because we have the minimum wage policy, which is already mandatory.

“We already have a lot of legislation (on wages) and employers should be given some kind of flexibility to try to achieve the government’s goal in making Malaysia a high-income country,” he said.

Meanwhile, MEF president Datuk Seri Dr Syed Hussain Syed Husman said many business owners will be affected with the new policy, especially with over 90% of businesses in Malaysia being small and medium enterprises.

“If the business cannot afford it and such a policy is made compulsory, you would see a lot of businesses having to close down,” he added.

A total of RM50mil was llocated for the implementation of the PWP pilot project, where participating firms receive a monthly incentive, with a maximum of RM200 per entry-level employee and up to RM300 for those who have been with the company for over a year.

https://www.thestar.com.my/news/nation/2024/11/28/mef-employers-hesitant-about-pwp-implementation