The Progressive Wage Policy (PWP) could help low-income Malaysians earn better wages if it were made mandatory, according to an activist and a former MP.
Women’s Aid Organisation (WAO) advocacy manager Gandipan Gopalan said while the PWP is a positive initiative to ensure fairer compensation for workers, its voluntary nature and limited participation weaken its effectiveness.
“The PWP can help bridge wage disparities if it’s made compulsory and properly enforced. If implemented well, it could make a real difference for single mothers, women in small businesses, and contract workers at government premises,” Gandipan told FMT.
Introduced under the 12th Malaysia Plan mid-term review, the PWP ties wage increases to productivity and skills development. Employers who join voluntarily receive government incentives for raising salaries and providing training opportunities.
According to the human resources ministry, the policy aims to address employers’ concerns over rising wages while improving productivity and reducing employee turnover.
Former Klang MP Charles Santiago described the PWP as an acknowledgment that Malaysia’s current labour market does not always benefit low-wage earners.
“That’s why it should be mandatory rather than voluntary,” said Santiago, who has long advocated for fair wages.
He noted that similar schemes in South Korea and Singapore only produced significant wage growth after participation became compulsory.
“The PWP recognises that the system itself needs strong support mechanisms to lift workers up,” Santiago added.
