The Malaysian Trades Union Congress has welcomed Economy Minister Mohd Rafizi Ramli’s proposal for a progressive wage policy, saying that it would close the gap between wage growth and the rising cost of living.

It also said government intervention is necessary because the current minimum wage policy does not require employers to periodically raise salaries, causing the wages of some workers to become stagnant at the minimum wage level even after 25 years on the job.

“The government needs to...