Malaysia, which has been one of the major overseas job destinations for Nepali youths over the years, has decided to raise the minimum wage of workers in all sectors to RM 1,700 (or around Rs 53,200) per month from RM 1,500.
The new wages announced on Friday, October 18, will come into effect from February 1, 2025.
Presenting the budget for 2025, Prime Minister Datuk Seri Anwar Ibrahim announced that the government agreed to raise the minimum wage from RM 1,500 per month to RM 1,700 per month, effective February 1, 2025, reports Malay Mail , a Kuala Lumpur-based newspaper. However, Anwar, also the Finance Minister, said that the enforcement of the new wage provision for employers with fewer than five employees would be delayed by six months, taking effect from August 1, 2025.
Similarly, Malaysia’s Human Resources Minister Steven Sim said that the raise was part of the government’s efforts to ensure the welfare of workers, particularly those with low incomes, while prioritising the people and elevating their dignity, according to the news outlet.
Around 400,000 Nepalis are estimated to be working in Malaysia.
While nearly 220,000 Nepali youths went to Malaysia with new labour permits in the fiscal year 2022/23, the number dropped to 81,382 last fiscal year, 2023/24, after it decided to completely halt the recruitment of foreign workers in the formal sector from June 1, 2024.
The decision taken in March 2023 permitted foreign workers to enter Malaysia until the end of May 2024. The visa application deadline was set for April 21. It was aimed at limiting the foreign workers’ quota below 15 percent of the total workforce by 2025, Minister Sim had told the parliament earlier this year in March.
At that time, over 70 percent of Malaysia’s migrant labour force was estimated to be composed of workers from Indonesia, Bangladesh and Nepal. The country also has a significant number of Indian, Vietnamese, Pakistani and Thai workers.
Read: Concerns in Nepal as Malaysia Freezes Foreign Workers Hiring
There were around 2.1 million foreign workers in Malaysia until February this year, according to the Malaysian Immigration Department.
As per the Labor Migration Report 2022, Malaysia along with the six Gulf Cooperation Council (GCC) countries - Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates - were the top labour destinations for Nepali workers. Since 2013/14, these seven countries have consistently accounted for over 80% of employment opportunities for outbound Nepali workers.
Malaysia, which hosts foreign workers from 15 countries including Nepal, however partially opened its labour market for foreign workers a month ago. It has decided to intake workers in a few sectors including plantation and garment, by fixing a quota.
Back in 2018, Nepal and Malaysia signed a memorandum of understanding which had provisions of making employers pay all the expenses in the recruitment process. The “zero-cost” recruitment policy received applause from all quarters, but it remained on paper. There have been reports of aspiring migrant workers paying as much Rs 300,000 per person to recruitment agencies to secure jobs in Malaysia.
Labour migration to Malaysia has disrupted multiple times in the past. After the 2018 agreement, Nepal stopped sending workers to Malaysia for 16 months due to issues regarding recruitment fees and labour market conditions.
Nepal Labour Migration Report 2022 says that a total of 10,666 Nepalis have died in labour destinations since 2008-09, with 817, the second highest toll after Saudi Arabia, in Malaysia alone.