KUALA LUMPUR, Oct 17 (Bernama) -- The Starting Basic Salary Guidelines based on the Malaysia Standard Classification of Occupations (MASCO) must be supported by transparent monitoring and reporting mechanisms to ensure employers comply with the prescribed salary benchmarks, an economic analyst said.
Associate Professor Dr Ahmed Razman Abdul Latiff of Putra Business School said that without clear enforcement mechanisms, employers could potentially disregard the guidelines without facing legal action, making it difficult for graduates to challenge low salary offers.
He said setting a starting salary of RM2,500 would not necessarily guarantee equity if the scope of duties, skill levels and responsibilities of a job were not accurately assessed.
“Job classifications under MASCO must be reviewed based on actual duties, not merely the job titles stated in employment contracts.
“The government must also clearly define basic salary and allowances to prevent employers from including bonuses, overtime or variable payments to obscure the actual salary rate,” he said when contacted by Bernama.
He was commenting on the Human Resources Ministry’s (KESUMA) announcement that it was drafting guidelines to ensure the orderly implementation of minimum wage policies and starting basic salaries for graduates and semi-skilled workers, as announced in Budget 2027.
Human Resources Minister Datuk Seri R. Ramanan said the guidelines would provide a more comprehensive reference for starting basic salaries based on job categories and qualification levels, while amendments to the National Wages Consultative Council Act 2011 (Act 732) were being fine-tuned to make it mandatory for graduates to be paid the minimum wage in the future.
Ahmed Razman said that pending the amendments, the government should establish a clear transition plan, including annual compliance targets, reporting on starting salary rates and the publication of compliance levels by sector.
He said government-linked companies and government contractors should also take the lead by complying with the benchmarks first, while incentives such as priority in government procurement or recognition as progressive employers could be considered to encourage compliance.
To ensure the guidelines were implemented effectively, he said the government should conduct risk-based compliance audits, particularly in sectors that employ large numbers of graduates and offer low salaries, as well as provide channels for workers to lodge complaints and protection for whistleblowers.
On the e-Wages mechanism being fine-tuned by KESUMA to strengthen salary payment monitoring, Ahmed Razman said the system should integrate salary data with bank transaction records, employment contracts, payslips, Employees Provident Fund (EPF), Social Security Organisation (PERKESO) and relevant tax records, subject to personal data protection safeguards.
He said the move would enable the government to compare promised salaries with the actual amounts received by workers, as well as detect late payments, underpayments and employers who repeatedly violated the rules.
“Automated risk analysis could help the Labour Department target inspections at high-risk employers. However, the system must have data security safeguards and verification procedures in place before enforcement action is taken,” he said.
He also stressed that payment verification should not rely entirely on employers’ reports, but should instead involve cross-checking bank transactions against salary records, confidential confirmation from workers and surprise audits.
Workers should also be given access to their own salary payment records and protected from retaliation if they reported irregularities, he said.
Meanwhile, senior lecturer at the Faculty of Management and Business, Universiti Teknologi MARA (UiTM) Sabah branch, Dr Jain Yassin, said the government should provide transparent salary data by occupation, qualifications, skills, sector and location to help graduates assess salary offers more accurately.
He said the information gap between employers and graduates could lead job seekers to accept offers below appropriate levels because they lacked sufficient information on prevailing market salaries.
“To address this, the government could enhance the e-MASCO portal by providing salary information by occupation, qualifications and skill levels, and updating it regularly to enable graduates to compare salary offers with market rates,” he said.
Meanwhile, Jain said the e-Wages mechanism should function as an early warning system to detect non-compliance through automated monitoring of basic salaries, allowances, late payments and discrepancies with employment contracts.
However, he stressed that the system should be integrated with artificial intelligence (AI), payroll data and labour market analysis to detect non-compliance more systematically. WhatsApp applications or a hotline could also be used as channels for workers to lodge complaints, with assurances of confidentiality and protection against retaliation by employers.
To ensure the accuracy of payment records, he also proposed appointing independent monitors, including professional bodies, university researchers or labour economists, to conduct regular audits and objectively assess employers’ compliance levels.
Prime Minister Datuk Seri Anwar Ibrahim, when tabling Budget 2027 on Oct 9, announced that the government had agreed to raise the minimum wage from RM1,700 to RM2,000, effective June 2027, a move expected to benefit more than four million workers.
Anwar was reported to have said that micro, small and medium enterprises (MSMEs) with annual sales of less than RM50 million would be exempted from implementing the new rate to give them room to adjust their respective business models.
-- BERNAMA