PETALING JAYA: The implementation of the minimum wage hike to RM1,500 could lead to price increases as businesses seek to protect their business margins, says the National Chambers and Commerce and Industry of Malaysia (NCCIM).

       Its president Datuk Low Kian Chuan said there were concerns regarding the minimum wage hike, as it comes at a time when businesses are recovering from the economic effects of Covid-19 restrictions.

       Low also said many businesses were facing substantial increases in business costs, worker shortages and cautious consumer spending.

       "Imposing additional labour costs on businesses could force impacted business owners to raise prices and reduce employment to preserve their business margin.

       "The knock-on effect of the proposed minimum wage on other categories of workers will add to higher employment and operating costs," said Low in a statement on Tuesday (March 22).

       Low also urged the government to postpone the proposed May 1 implementation of the minimum wage hike, as the local business community needs breathing space to rebuild the businesses.

       "Most businesses are not financially stable to implement the proposed minimum wage as their cash flow and revenue are still on the mend and have not fully restored back to pre-pandemic level.

       "The NCCIM would like the government to take into consideration current economic and business conditions as well as cost and business competitiveness implications on domestic businesses when implementing the new minimum wage," said Chuan in a statement on Tuesday (March 22).

       Low also said the business community was caught by a surprise with the "abrupt" announcement of a "steep increase of between 25% to 35% in the RM1,500 per month from the present RM1,100 to RM1,200".

       Low also said the minimum wage hike had caused adverse reactions and anxieties among many industries and employers, as the timeline of implementation is too short for employers to make preparations.

       Low claimed that in the past, there were sufficient engagement and a timeline for the implementation of the minimum wage hike.

       Low said the NCCIM would like to have an engagement session with the Human Resources Ministry to get further clarifications regarding the new minimum wage mechanisms.

       On Saturday (March 19), Prime Minister Datuk Seri Ismail Sabri Yaakob announced during the Umno general assembly that the national minimum wage would be revised to RM1,500 beginning May 1.

       He had said discussions between the relevant ministries would also be held to look into delaying the implementation of the policy for small and micro businesses with low income or revenue.