THE Cabinet has agreed to exempt Micro, Small, and Medium Enterprises (MSMEs) from the implementation of the new minimum wage rate increase for the time being.
This decision was announced after the Minister of Entrepreneur and Cooperatives Development, Steven Sim Chee Keong, raised the minimum wage issue during the Cabinet meeting on Wednesday.
Sim stated that the government would adopt alternative approaches to help raise wages for workers in the MSME sector—including wage subsidy support under the Progressive Wage Policy—to ensure that wage increases align with productivity growth.
"I raised the minimum wage issue during today's (Wednesday) Cabinet meeting. The Cabinet agreed that the people's wages must continue to be raised.
"However, we must also protect local businesses, particularly MSMEs, which are currently facing operational cost pressures and prevailing economic challenges.
"Our goal is clear: to safeguard workers' welfare through fairer wages while ensuring MSMEs remain competitive enough to grow and generate job opportunities," he said in a statement.
It was earlier reported that the minimum wage rate is expected to rise to RM1,700, with details to be announced by Prime Minister Datuk Seri Anwar Ibrahim during the Budget 2027 presentation on October 9.
According to Anwar, the review and study regarding the minimum wage adjustment are currently in the final stages prior to the announcement during the budget presentation in the Dewan Rakyat. – September 30, 2026
