Abstract
1. Introduction
2. Literature review and hypotheses development
3. Methods
4. Results
5. Discussion, implications, and conclusions
6. Limitations and future research
References
Abstract
This study develops and tests a research model to analyze the overall effects of minimum wage policy implementation on hotel employees’ overall perception of the minimum wage policy in relationship to satisfaction with compensation, work behaviors, and perceived quality of life. An electronic survey was developed, and data were collected from hotel employees who worked at three-, four-, and five-star hotels in Malaysia. Results from the structural equation modelling analysis and the bootstrap mediational effects analysis offered significant empirical findings that will enable understanding of the overall effects of minimum wage increases on Malaysian hotel employees. Employee perception of minimum wage policy significantly influenced their satisfaction with compensation and work motivation. Additionally, employee satisfaction with compensation significantly influenced their work motivation, job satisfaction, and perceived quality of life. Limitations and future research directions are discussed.
Introduction
In 2009, the Ministry of Human Resources Malaysia found 40% of private sector employees had incomes below the poverty level (Guie, 2012). Knowing that the poverty rate could be reduced by increasing employee income (Yusof et al., 2016), Malaysia government took steps similar to other countries and implemented a minimum wage policy in 2013. The policy was implemented throughout all businesses and was set monthly at RM900 (USD215) for Peninsular Malaysia and RM800 (USD191) for other regions (Attorney General’s Chambers of Malaysia, 2012). In 2016, the monthly minimum wage was increased by 10% to RM1,000 (USD236) for Peninsular Malaysia and RM920 (USD217) for other parts of Malaysia (Attorney General’s Chambers of Malaysia, 2016). Given the National Wages Consultative Council (NWCC) review of the Minimum Wages Order of 2016 and current economic conditions, another increase in the minimum wage (RM1,100 per month) started January 2019; this rate was standardized throughout the country (Attorney General’s Chambers of Malaysia, 2018). The minimum wage policy objectives in Malaysia include assuring basic needs of employees and their families are met and giving social protection to employees through minimum acceptable wages (http://minimumwages.mohr.gov. my/). The minimum wage policy aims to improve the living standards of Malaysian and non-Malaysian employees and reflects the Malaysian government’s commitment to overcoming poverty.