The signing of Malaysia's first minimum wage law, affecting approximately 3.2 million private sector workers, signifies great progress in modernising labour legislation, reflecting the government's commitment to human capital development.
Aiming to boost productivity and competitiveness in the workplace, the government set the minimum wage rate at 900 ringgit (HK$2,213.70) per month for peninsular Malaysia and 800 ringgit for Sarawak, Sabah and Labuan Federal Territory.
Extending the retirement age and future amendments to the Industrial Relations Act are also some upcoming initiatives to transform the workplace.
Streamlining labour legislation plays a crucial part in the government's aim to transform Malaysia into a high-income nation and ensure its global competitiveness.
The modernisation of labour laws also helps the government to reduce labour management costs and encourage potential foreign investors to conduct business in Malaysia.
Workforce transformation goes hand in hand with workplace transformation. Collaborating with the private sector, the Malaysian government is providing incentives to employees to upskill in international certification and training programmes to meet the skill sets that multinational companies (MNCs) require. It also serves as the bridge between academia and industry, helping to hone industry-ready graduates. The government's goal is to showcase the capabilities of the local talent pool and transform the country into a talent hub by 2020.
"To become a high-income nation, we have to move from a model which is reliant on cheap labour towards a more knowledge-based, productive workforce. We need to develop new skill sets to achieve this goal," says Azian Shahriman, NKEA director of education.
Addressing skill gaps in oil and gas, tourism, information and communications technology (ICT), and engineering across industries, is a priority.
The government pioneers initiatives, such as Malaysia MyProCert programme, to accelerate the upskilling of ICT capabilities.
MyProCert participants receive a minimum of 25 per cent reduction off the certification fees from private sector players. The government also reimburses 25 to 30 per cent of the fees to the employees as an additional incentive upon passing the course.
A national talent enhancement programme for engineering graduates and technical vocational certificate holders is also in place, in which the government looks for host companies to provide graduates with industry experience in an immersive environment.
"The Malaysian government is responsive and it creates a business-friendly environment," Azian says. "It is very accommodating to investors - all they have to do is to specify their needs and the government will work on developing the talent pool that they need for a successful business. Interested investors need to work with the government. Malaysia is open for business."