Workers laid off over the RM2,000 minimum wage can claim EIS allowance for up to six months

Workers laid off when companies restructure to cope with the new RM2,000 minimum wage can claim Employment Insurance System (EIS) benefits if they are covered by the scheme, including a Job Search Allowance for up to six months, says Economy Minister Akmal Nasrullah Mohd Nasir.

He was replying in the Dewan Rakyat on Tuesday, 13 October, to Datuk Aminolhuda Hassan (PH-Sri Gading), who asked how the government would make sure the higher minimum wage does not lead to job cuts, higher prices or higher operating costs for small businesses.

RM2,000 minimum wage from June 2027

The minimum wage rises from RM1,700 to RM2,000 a month from June 2027, as Prime Minister Datuk Seri Anwar Ibrahim announced when tabling Budget 2027 last Friday. More than four million workers are expected to benefit.

Akmal said micro, small and medium enterprises (MSMEs) with annual sales below RM50 million are exempt, so employers can rearrange their finances and operations without drastic steps such as retrenching staff. MSMEs employ 8.09 million workers, or 48.7 per cent of the country's workforce.

The new Minimum Wages Order will be enforced by the labour departments of Peninsular Malaysia, Sabah and Sarawak under the National Wages Consultative Council Act [Act 732]. Workers can file a complaint if their employer does not comply, and employers who break the law can be fined or jailed under Section 43 of the Act.

Wage council agreed, MSMEs given more time

Utusan Malaysia reported that the RM2,000 rate was tabled and approved by the National Wages Consultative Council, whose members include union and employer representatives. Treasury secretary-general Tan Sri Johan Mahmood Merican said that at Cabinet level, consideration was given to allowing MSMEs a slightly longer adjustment period. Large companies will go first.

Risk of pay gaps

In a supplementary question, Aminolhuda asked whether employers might hire fewer graduates or change job requirements to avoid higher salary costs. Akmal said wage increases must come with higher productivity through skills, technology and training.

He acknowledged the risk of wage compression, where the minimum wage goes up but pay for more skilled or qualified workers does not rise in step. One step under consideration, according to The Star, is raising the living-wage benchmark for government-linked investment companies (GLICs) and government-linked companies (GLCs) from RM3,100 to RM3,400 next year.

How to claim EIS benefits

The Social Security Organisation (PERKESO) now runs the EIS under the name LINDUNG KERJAYA. Set up on 1 January 2018, it provides replacement income for insured persons who lose their jobs. According to PERKESO:

• When to apply: within 60 days of losing your job.
• Conditions: you must have paid enough monthly contributions, and the job loss must fit the EIS Act's definition, which includes normal retrenchment, voluntary or mutual separation schemes (VSS/MSS) and business closures.
• How long: the Job Search Allowance is paid for three to six months, depending on your contribution record.
• How to apply: through the LINDUNG KERJAYA portal at lindungkerjaya.perkeso.gov.my. Applicants must register with MYFutureJobs to be matched with job vacancies.

For job losses from 1 October 2026, the Early Re-employment Allowance, paid to those who find work early, is now 50 per cent of the unpaid Job Search Allowance balance, up from 25 per cent. PERKESO's hotline is 1-300-22-8000.

What's next

To keep prices in check, the government will step up enforcement of the Price Control and Anti-Profiteering Act 2011 and is setting aside RM700 million for 30,000 Jualan Rahmah Madani programmes next year. For the other Budget 2027 measures, see Budget 2027, what changes for your wallet.

Sources

• The Star, Retrenched workers amid RM2,000 minimum wage hike eligible for EIS, says Akmal, 13 October 2026
• Sinar Harian, Pekerja terjejas akibat pelarasan gaji minimum layak tuntut elaun cari kerja, 13 October 2026
• Utusan Malaysia, Pekerja diberhentikan layak tuntut faedah SIP sehingga enam bulan, 13 October 2026
• Utusan Malaysia, Gaji minimum dipersetujui Majlis Perundingan Gaji Negara, 13 October 2026
• PERKESO, Employment Insurance System and Employment Services (LINDUNG KERJAYA), accessed 13 October 2026