Social Compliance Audit: Living Wage Survey in Malaysia
Ensuring workers receive a living wage in Malaysia is a crucial aspect of corporate social responsibility (CSR) and compliance with social audit requirements. Many frameworks such as SMETA, RSPO, and GSTC mandate companies to assess the gap between the minimum wage and a living wage. This is helping businesses comply with labor rights standards and promote fair compensation.
Understanding the Living Wage in Malaysia
A living wage is the level of income required for a worker to afford a decent standard of living in Malaysia. This includes essential expenses such as:
✔ Food, water, and clothing
✔ Transportation and healthcare
✔ Housing and provision for unexpected expenses
✔ Social participation, such as visiting family during festive seasons or affording a smartphone
✔ Personal development and education
Living Wage vs. Minimum Wage in Malaysia
The minimum wage in Malaysia was introduced in 2013 to protect workers’ basic needs. A living wage in Malaysia is not a legal requirement but is used as a benchmark to evaluate wage adequacy. It is often higher than the minimum wage and serves as an indicator of whether salaries meet workers’ actual living expenses.
How to Conduct a Living Wage Survey in Malaysia
1. Use Official Living Wage Data in Malaysia as reference
Start by reviewing publicly available statistics. The Department of Statistics Malaysia (DOSM) provides household expenditure data for different states. However, local cost variations must be considered when determining the living wage in Malaysia.
2. Consider Regional Differences in the Living Wage in Malaysia
The cost of living varies significantly within Malaysia. For example, the living wage in Petaling Jaya is much higher than in Kuala Selangor, despite both being in the state of Selangor.
3. Define Household Composition for a Living Wage in Malaysia
In Malaysia, the legal definition of a household includes individuals who live together and share daily provisions. Households may consist of:
- Single individuals
- Couples (married or unmarried)
- Parents and children
- Extended family members sharing living expenses
4. Collect Data on Essential Living Expenses in Malaysia
It is necessary for you to conduct interview and collect information from the employees. A living wage survey must include the following cost categories:
✔ Food
✔ Water
✔ Clothing
✔ Transport
✔ Healthcare
✔ Education & personal development
✔ Housing & provision expenses
✔ Social & recreational activities
5. Compare Wages and Identify Living Wage Gaps in Malaysia
To evaluate whether workers are receiving a living wage in Malaysia, compare:
- Legal Minimum Wage in Malaysia: MYR 1,700 (as in Feb 2025)
- Company’s Average Minimum Wage
- Company’s Average Gross Salary
- Living Wage Gap:
(Surveyed Living Cost – Company’s Average Nett Wage)
Conducting a living wage survey in Malaysia is essential to ensure fair wages and compliance with social audit standards. The table below provides a reference for monthly basic expenditure for a living wage in Malaysia (DOSM, 2023), but an average data means there is a great chance that the data might be undervalued if your location is in a city center or highly commercial area, where the living cost is higher than the values presented.
To evaluate whether workers are receiving a living wage in Malaysia, compare:
- Legal Minimum Wage in Malaysia: MYR 1,700 (as in Feb 2025)
- Company’s Average Minimum Wage
- Company’s Average Nett Wage
- Living Wage Gap:
(Surveyed Living Cost – Company’s Average Nett Wage)
Conducting a living wage survey in Malaysia is essential to ensure fair wages and compliance with social audit standards. The table below provides a reference for monthly basic expenditure for a living wage in Malaysia (DOSM, 2023), but an average data means there is a great chance that the data might be undervalued if your location is in a city center or highly commercial area, where the living cost is higher than the values presented.
Therefore, you must use the table as a reference only but also collect the information by yourself by doing a local survey or interviewing the workers. You should use the below table for your data collection.
6. Consider Migrant Workers’ Living Wage in Malaysia
Migrant workers often have financial responsibilities beyond their personal expenses in Malaysia. A fair living wage survey in Malaysia must consider:
✔ Household size in their home country
✔ Children’s education, healthcare, and housing costs
✔ Family transportation expenses
To estimate better the living wage for foreign workers, you may consider the the decent living wage costs in different countries below:
Key Takeaways for Employers in Malaysia
✅ Always conduct a local living wage survey instead of relying solely on national statistics.
✅ Recognize the higher cost of living in cities when calculating a living wage in Malaysia.
✅ Compare surveyed data with company wages to identify gaps.
✅ Update living wage assessments regularly to reflect inflation and economic conditions.
About Thinkinbio
At Thinkinbio, we are passionate about supporting businesses on your journey toward ethical and sustainable practices. We believe that fair wages, worker well-being, and social responsibility are key pillars of a resilient supply chain. Whether you’re just beginning to explore the concept of living wage in Malaysia, or looking to improve your internal processes, we’re here to share knowledge, tools, and insights that make a difference.
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