Guan Eng says foreign workers should be excluded from minimum wage hike, calls for EPF levy repeal

In a statement, Lim said Prime Minister Datuk Seri Anwar Ibrahim is expected to announce a revision to the minimum wage during the tabling of Budget 2027 on Oct 9, following the government’s assessment that wage growth has not kept pace with gains in worker productivity and corporate profits. — Picture by Firdaus Latif

By Malay Mail

First Published: Tuesday, 29 Sep 2026 3:10 PM MYT

GEORGE TOWN, Sept 29 — DAP chairman Lim Guan Eng today called on the government to exclude foreign workers from any increase in Malaysia’s minimum wage, arguing that the move would help protect local businesses, particularly micro, small and medium enterprises (MSMEs), from rising operating costs.

In a statement, Lim said Prime Minister Datuk Seri Anwar Ibrahim is expected to announce a revision to the minimum wage during the tabling of Budget 2027 on Oct 9, following the government’s assessment that wage growth has not kept pace with gains in worker productivity and corporate profits.

While acknowledging the rationale for higher wages, Lim said the prospect of a minimum wage increase has sparked concern among local businesses already grappling with intense competition, higher compliance costs and taxes, as well as price pressures from overseas producers.

He said MSMEs, which form the backbone of the domestic economy, are facing mounting challenges amid a sluggish economic environment and should be consulted before any policy changes are implemented.

Lim argued that any upward revision in the minimum wage should apply only to Malaysian workers, saying foreign employees should not benefit from the increase as they were hired under mutually agreed employment contracts.

He also renewed calls for the immediate abolition of the mandatory two per cent Employees Provident Fund (EPF) contribution for foreign workers, contending that the requirement imposes an unnecessary burden on employers without providing meaningful benefits to migrant workers.

According to Lim, exempting foreign workers from minimum wage increases and scrapping the EPF contribution requirement would help ease cost pressures on local businesses and safeguard the viability of approximately 1.2 million MSMEs nationwide.

He urged the government to prioritise the interests of domestic enterprises and ensure that policies designed to raise wages do not inadvertently undermine the competitiveness of Malaysian businesses.