Malaysian Trades Union Congress urges RM3,100 minimum wage push in Budget 2027

KUALA LUMPUR, 27 SEPTEMBER 2026 —

The Malaysian Trades Union Congress (MTUC) has demanded that the government raise the national minimum wage to RM3,100 in Budget 2027, arguing that current wages have failed to keep pace with rising productivity and corporate profits, while calling on government-linked companies (GLCs) and investment firms to set the standard for fairer remuneration.

The push comes as Prime Minister Anwar Ibrahim—who also serves as finance minister—has signaled in recent statements that Budget 2027 will include measures to align private-sector wages with productivity gains, though his approach will focus on negotiation rather than regulatory pressure. The MTUC’s call underscores growing labor unrest over stagnant wages amid record corporate earnings, with unions framing the RM3,100 threshold as both a living wage benchmark and a test of corporate responsibility.

MTUC secretary-general Kamarul Baharin Mansor stated in a Free Malaysia Today report that GLCs and GLICs—which have already begun implementing the RM3,100 minimum wage for permanent employees—must lead by example before private firms are compelled to follow. "Fair wages must start with GLCs and GLICs," he said.

"It should not be only the top management that benefits while workers at the bottom are left with the scraps." Kamarul welcomed Anwar’s recent criticism of large corporations that maintain low wages despite posting "huge profits," arguing that workers who drive those profits deserve a greater share.

Anwar’s remarks on September 26 marked the first explicit link between Budget 2027 and wage policy, revealing plans to explore "ways to negotiate with the private sector" to raise salaries in line with productivity—an approach that contrasts with past threats of legal action.

The prime minister’s stance follows a May 2025 directive requiring six GLICs—including Khazanah Nasional Bhd, Permodalan Nasional Bhd, Employees Provident Fund (EPF), Retirement Fund Inc, the Armed Forces Fund Board, and Lembaga Tabung Haji—to adopt the RM3,100 living wage policy for permanent staff. Anwar had previously disclosed in Parliament last year that 34 GLCs and GLICs had since implemented the policy, though enforcement remains uneven across the broader private sector.

The MTUC’s demand reflects broader labor-market tensions, with Malaysia’s current minimum wage of RM1,700 widely criticized as insufficient for skilled workers and graduates. Anwar himself has acknowledged this disparity, stating that the RM1,700 floor "should not be treated as the starting salary" for professionals, signaling potential tiered wage structures in future policy.

The push for RM3,100 aligns with ongoing debates over living wage standards, particularly in sectors where inflation and cost-of-living pressures have outpaced nominal wage growth.

For Malaysian markets, the MTUC’s call introduces a new variable in Budget 2027 negotiations, with potential implications for labor costs, corporate profitability, and wage-led consumption. While GLCs and GLICs have already begun adjusting pay scales, private-sector resistance could delay broader adoption, particularly in labor-intensive industries where margins remain tight.

The government’s emphasis on negotiation over regulation may ease immediate business backlash, but unions and opposition parties are likely to scrutinize Budget 2027 for concrete wage-related allocations.

The next critical development will be the finance ministry’s response in the October 2026 Budget announcement, where Anwar is expected to outline specific wage-linked measures. If the RM3,100 threshold gains traction, it could trigger a domino effect in private-sector wage reviews, though smaller firms may resist without incentives or enforcement mechanisms.

The MTUC’s campaign also risks escalating labor disputes unless employers preemptively adjust compensation packages, particularly in manufacturing, services, and agriculture, where wage stagnation has been most acute.