Malaysia Minimum Wage Guide 2026: Current Rates, Employer Obligations, Overtime Rules & Employee Rights
Complete guide to Malaysia's minimum wage in 2026. Covers the RM1,700 monthly rate, who it applies to, employer obligations, overtime pay calculations, exemptions, enforcement, and how to use a salary calculator to check your payslip.
Malaysia's minimum wage policy directly affects over 4 million workers across the country — from retail assistants and factory operators to cleaners and food service staff. Whether you employ workers or earn a salary yourself, understanding the minimum wage rules is essential.
As of 2026, the national minimum wage stands at RM1,700 per month, following the latest revision that took effect in phases throughout 2025. This guide explains exactly who is covered, what employers must do, how overtime is calculated on top of the minimum wage, and which exemptions exist.
To check whether your current salary meets legal requirements — including EPF, SOCSO, and EIS deductions — use the free salary calculator Malaysia by DuitTools. Enter your monthly wage and see your full payslip breakdown instantly.
What Is the Current Minimum Wage in Malaysia?
The minimum wage in Malaysia is governed by the Minimum Wages Order, issued under the National Wages Consultative Council Act 2011. The current order sets the following rates:
| Category | Monthly Rate | Daily Rate | Hourly Rate |
|---|---|---|---|
| All sectors (5+ employees) | RM1,700 | RM65.38 | RM8.17 |
| Micro employers (<5 employees) | RM1,700 | RM65.38 | RM8.17 |
Key points:
- The RM1,700 monthly rate applies nationwide — Peninsular Malaysia, Sabah, Sarawak, and the Federal Territory of Labuan. There is no longer a regional differential.
- The daily rate is calculated as: monthly rate ÷ 26 working days
- The hourly rate is calculated as: daily rate ÷ 8 working hours
- For employees paid by piece rate, tonnage, trip, or commission, the employer must ensure that the total wages earned in a month equal or exceed RM1,700
Minimum Wage History in Malaysia
| Effective Date | Peninsular Malaysia | Sabah & Sarawak | Monthly Increase |
|---|---|---|---|
| January 2014 | RM900 | RM800 | — (first national minimum wage) |
| July 2016 | RM1,000 | RM920 | RM100 / RM120 |
| January 2019 | RM1,100 | RM1,100 | RM100 / RM180 |
| February 2020 | RM1,200 | RM1,200 | RM100 |
| May 2022 | RM1,500 | RM1,500 | RM300 |
| February 2025 | RM1,700 | RM1,700 | RM200 |
The government has signalled an intention to reach RM2,000–RM2,500 by 2027–2028, though this depends on economic conditions and the National Wages Consultative Council's recommendations.
Who Is Covered by the Minimum Wage Order?
The Minimum Wages Order applies to all private sector employees regardless of nationality — Malaysian citizens, permanent residents, and foreign workers are all covered.
Covered Employees
- Full-time employees under a contract of service
- Part-time employees (on a pro-rated basis)
- Temporary and contract workers
- Probationers (employees on probation are entitled to minimum wage from day one)
- Foreign workers with valid work permits
- Piece-rate, commission, and tonnage workers (total monthly earnings must meet or exceed RM1,700)
Exemptions
Certain categories are exempt from the Minimum Wages Order:
| Exempt Category | Reason |
|---|---|
| Domestic workers | Governed separately under the Employment Act with specific provisions for domestic servants |
| Apprentices | Individuals under a registered apprenticeship contract with a training institution (not simply a junior employee called an "apprentice") |
| Disabled employees | Workers with a disability certification from the Department of Social Welfare (JKM), where the employer applies for and receives an exemption certificate from the Director General of Labour |
| Employees of government and statutory bodies | Public sector employees are governed by separate remuneration schemes (SSM, SBPA, etc.) |
| Family members | Family members working in a family business who are dependents of the business owner |
Employer Obligations Under the Minimum Wage Order
Employers must comply with the following:
1. Pay At Least the Minimum Wage
The basic salary (not including overtime, allowances, or bonuses) must be at least RM1,700 per month. Employers cannot use allowances to top up a sub-minimum basic salary to reach RM1,700. The basic wage itself must meet the threshold.
2. Display the Minimum Wage Notice
Every employer covered by the order must display a notice stating the applicable minimum wage rate in a conspicuous place at the workplace. This is a legal requirement — failure to display can result in a fine.
3. Maintain Proper Payroll Records
Employers must maintain records showing:
- Each employee's basic wage
- All allowances paid separately
- Overtime hours and payments
- Deductions (EPF, SOCSO, EIS, PCB)
- Net wage paid
Records must be kept for at least 6 years.
4. Report Compliance
Upon request by the Labour Department (Jabatan Tenaga Kerja), employers must provide payroll records and demonstrate compliance. Random audits are conducted regularly.
5. Do Not Retaliate
Employers cannot dismiss, demote, or penalise an employee for making a complaint about minimum wage non-compliance. Doing so is a separate offence under the Employment Act.
Penalties for Non-Compliance
Employers who fail to pay the minimum wage face:
| Offence | Penalty |
|---|---|
| First offence | Fine up to RM10,000 per employee |
| Repeat offence | Fine up to RM20,000 per employee AND/OR imprisonment up to 5 years |
| Obstruction of inspection | Fine up to RM10,000 AND/OR imprisonment up to 1 year |
| Failure to keep records | Fine up to RM10,000 |
| Failure to display notice | Fine up to RM1,000 |
These penalties apply per affected employee, not per employer. An employer underpaying 10 workers by RM200/month could face fines totalling RM100,000 for a first offence.
Overtime Pay: How Much Above Minimum Wage?
Employees earning the minimum wage are entitled to overtime pay under the Employment Act 1955. Overtime is calculated based on the hourly rate of pay (HRP):
HRP = Monthly wage ÷ 26 days ÷ 8 hours
For an employee earning exactly RM1,700/month:
- Daily rate: RM1,700 ÷ 26 = RM65.38
- Hourly rate: RM65.38 ÷ 8 = RM8.17
Overtime Rates
| Type | Rate | Example (RM1,700/month) |
|---|---|---|
| Normal overtime (after 8 hours, up to 10 hours) | 1.5 × HRP | RM12.26/hour |
| Overtime beyond 10 hours | 2.0 × HRP | RM16.34/hour |
| Rest day (first 4 hours) | 1.0 × daily rate | RM65.38 |
| Rest day (beyond 4 hours) | 2.0 × HRP | RM16.34/hour |
| Rest day + public holiday | 2.0 × daily rate | RM130.76 |
| Public holiday (within normal hours) | 2.0 × daily rate | RM130.76 |
| Public holiday overtime (beyond normal hours) | 3.0 × HRP | RM24.51/hour |
Overtime Example
An employee earning RM1,700/month works 3 hours of overtime on a normal working day:
- Hourly rate: RM8.17
- Overtime rate: RM8.17 × 1.5 = RM12.26
- 3 hours of overtime: RM12.26 × 3 = RM36.78
That month's gross pay: RM1,700 + RM36.78 = RM1,736.78 (before EPF, SOCSO, EIS deductions).
How the Minimum Wage Affects EPF, SOCSO, EIS, and PCB
The minimum wage is your gross basic salary. Mandatory deductions are calculated on this amount:
| Deduction | Calculation on RM1,700 | Amount |
|---|---|---|
| EPF (Employee 11%) | RM1,700 × 11% | RM187.00 |
| SOCSO | RM1,700 falls in the RM1,600.01–RM1,700 bracket | RM6.80 |
| EIS | RM1,700 × 0.2% | RM3.40 |
| PCB | After RM4,000 EPF relief + RM9,000 personal relief, chargeable income ~RM7,400 | ~RM2.00 |
Net take-home pay: approximately RM1,700 − RM187.00 − RM6.80 − RM3.40 − RM2.00 = RM1,500.80
Important: Your employer cannot deduct EPF, SOCSO, and EIS in a way that reduces your basic wage below RM1,700. These deductions come out of your RM1,700 gross, not in addition to it. The RM1,700 minimum refers to gross basic salary before statutory deductions.
Check your exact payslip: Salary Calculator Malaysia — enter RM1,700 and see every deduction with 2026 rates.
Employee Rights and How to Report Violations
If you believe your employer is not paying the minimum wage, you have several avenues:
1. Raise the Issue Internally
Speak with your HR department or supervisor first. Sometimes underpayment is an administrative error that can be corrected quickly. Check your payslip carefully — ensure overtime, allowances, and deductions are itemised separately from your basic salary.
2. File a Complaint with the Labour Department
Visit the nearest Jabatan Tenaga Kerja (JTK) office. Bring:
- Your IC (MyKad) or passport (for foreign workers)
- Employment contract or offer letter
- Payslips for the past 3–6 months
- Bank statements showing salary deposits
- Any written communication with your employer about the issue
The Labour Department will investigate and, if the employer is found in violation, can order payment of back wages with interest.
3. File a Complaint Through Working for Workers (WFW) App
The Ministry of Human Resources operates the WFW mobile app, which allows employees to file complaints anonymously. The app is available on iOS and Android.
4. Seek Assistance from the Labour Court
If the Labour Department's intervention does not resolve the issue, you can bring your case to the Labour Court. For claims of RM5,000 or less, the process is fast-tracked and does not require legal representation.
Special Categories and Common Questions
Part-Time Employees
Part-time employees are entitled to minimum wage on a pro-rated basis. If you work 4 hours per day instead of 8, your monthly minimum is RM850 (RM1,700 ÷ 2). The same overtime rules apply for hours beyond your contracted part-time schedule.
Piece-Rate and Commission Workers
If you are paid by output rather than by time — for example, RM0.50 per item assembled, or 10% commission per sale — your employer must ensure your total monthly earnings reach at least RM1,700. If your piece-rate earnings fall short, the employer must top up the difference.
Probationers
Employees on probation are entitled to the full minimum wage from the first day of employment. Employers cannot offer a reduced "probation rate" below RM1,700. This is one of the most common violations and should be reported if encountered.
Employees Provided with Accommodation
If your employer provides accommodation (common in construction, plantation, and domestic work), the value of accommodation cannot be counted toward the minimum wage. The RM1,700 is your cash wage. Accommodation is an additional benefit. However, a limited deduction for accommodation may be permitted if it is authorised in writing and does not reduce your cash wage below the minimum.
Foreign Workers
Foreign workers are entitled to exactly the same minimum wage as Malaysian workers. Employers cannot pay foreign workers less on the basis of nationality. Deductions for levy, accommodation, or recruitment fees must not reduce the worker's net cash wage below an amount that would make the effective wage fall below RM1,700.
Frequently Asked Questions
What is the minimum wage in Malaysia for 2026?
The national minimum wage is RM1,700 per month (RM65.38 per day, RM8.17 per hour), effective from February 2025 for employers with 5 or more employees and from August 2025 for micro employers. This rate applies uniformly across all states and sectors.
Does the minimum wage include overtime and allowances?
No. The RM1,700 is the basic salary before overtime, allowances, commissions, and bonuses. Your employer cannot use overtime payments or allowances to meet the RM1,700 threshold. The basic wage itself must be at least RM1,700.
Are foreign workers entitled to the minimum wage in Malaysia?
Yes. The Minimum Wages Order applies equally to Malaysian citizens, permanent residents, and foreign workers with valid work permits. Employers cannot pay foreign workers less based on nationality.
Can an employer reduce wages below RM1,700 for disciplinary reasons?
No. Disciplinary deductions must not reduce an employee's wage below the minimum wage in any given month. Any wage deductions — whether for discipline, loan repayment, or damage to company property — must leave the employee with at least RM1,700 in gross basic wages for that month.
What happens if my employer does not pay the minimum wage?
Report to the Labour Department (Jabatan Tenaga Kerja). The employer can be fined up to RM10,000 per affected employee for a first offence, and up to RM20,000 per employee plus imprisonment for repeat offences. The Labour Department can also order the employer to pay back wages owed with interest.
Does the minimum wage apply to small businesses?
Yes. The RM1,700 rate applies to all private sector employers, regardless of size. Micro enterprises with fewer than 5 employees were given an extended transition period (until August 2025) but must now fully comply.
Is there a separate minimum wage for different states in Malaysia?
No. The previous two-tier system (Peninsular Malaysia vs Sabah/Sarawak/Labuan) was unified. The RM1,700 rate applies nationwide. However, the government has indicated that future increases may reintroduce regional differentiation based on cost of living.
How is overtime calculated from minimum wage?
The hourly rate is RM1,700 ÷ 26 days ÷ 8 hours = RM8.17. Normal overtime (first 2 hours beyond the standard 8) is paid at 1.5× hourly rate = RM12.26/hour. Rest day work is paid at 1.0× daily rate for the first 4 hours and 2.0× hourly rate thereafter. Public holiday work within normal hours is paid at 2.0× daily rate.
Ensure Your Payslip Is Correct
Whether you earn the minimum wage or well above it, understanding your legal entitlements is essential. The free salary calculator Malaysia by DuitTools shows you exactly what your payslip should look like:
- Enter your monthly salary
- Instantly see EPF, SOCSO, EIS, and PCB deductions at 2026 rates
- Verify your net take-home pay
- Everything runs in your browser — no data leaves your device