Industry perspectives on Malaysian hotel minimum wage issues

Abstract

Purpose

The purpose of this paper is to investigate and compare the impact of the minimum wage order from the perspectives of two different stakeholders, namely, hotel managers and employees, in the Malaysian hotel industry.

Design/methodology/approach

For the study, qualitative data were collected through semi-structured interviews from three managers and three employees from hotels in West Malaysia.

Findings

From the managers’ perspective, minimum wage implementation has resulted in managers adopting the best payment structure to reduce labour costs for the operators, deciding to reduce the service charge allocation to employees and having to deal with minimal improvement in employee productivity and motivation. In contrast, the positive impact from the managers’ perspective is lower turnover intentions and social justice for foreign workers. From the employees’ perspective, there is a rather negative impact – minimum wage policy has resulted in a minimal increase in the salary. From a positive perspective, employees said that they have experienced an improvement in living standards.

Originality/value

This research presents current responses from hotel participants regarding the latest wage increase impact, some six years after its implementation.

Citation

Balasingam, A.S., Hussain, K. and Manaf, A. (2020), "Industry perspectives on Malaysian hotel minimum wage issues", Worldwide Hospitality and Tourism Themes, Vol. 12 No. 2, pp. 185-197. https://doi.org/10.1108/WHATT-12-2019-0082