A goodwill gesture<\/p>\n
The government's decision to raise regional minimum wages by
\nan average of 16 percent could easily be taken as a gross insult
\nconsidering the country suffered inflation of 77 percent in 1998.
\nFor many workers, real income has lagged so far behind runaway
\ninflation in the past two years that even a 100 percent increase
\nwould not make up for lost ground.<\/p>\n
But considering current economic conditions, including the
\nhigh unemployment rate, the wage increase is still significant.
\nThose of us who have jobs and are earning fixed incomes should
\ncount our blessings. Millions of others have been laid off since
\nthe crisis hit, and many more will lose their jobs in the course
\nof the next year or so until we see a turnaround in the economy.
\nThe entire nation has been impoverished by the crisis.<\/p>\n
Admittedly, the poorest among us, including those on minimum
\nwages, have to be bear the brunt. Officials at the Ministry of
\nManpower disclosed the minimum wage covers only about 70 percent
\nof the minimum physical requirements for an average single
\nperson, down from 75.8 percent in October. How people earning a
\nminimum wage survive defies the imagination of many of the more
\nfortunate.<\/p>\n
The government's decision to increase the minimum wage, albeit
\nby a token amount, is a goodwill gesture. It is a display of its
\ncommitment to improving the conditions of low-paid workers, even
\nin times of crisis. This time last year, as the crisis began to
\ntake its toll, the government of then president Soeharto decided
\nnot to grant any increase. It was not until August, when
\nPresident B.J. Habibie was already in charge, that an across-the-
\nboard increase was effected.<\/p>\n
The latest gesture will only be accepted in good faith if
\nthere are follow-up actions. As we wait for the economic rebound
\nthat will allow larger hikes in minimum wages, the government
\nmust turn its attention to improving labor rules and regulations
\nnot only to improve worker protection, but also to better
\ndelineate the respective rights and duties of workers and
\nemployers.<\/p>\n
Recent labor disputes indicate that laying off workers in
\nIndonesia is not only a protracted affair, but at times even
\ndestructive. Many companies do not have collective labor
\nagreements with their workers or, as events have shown, those
\nwhich do exist are often seriously flawed. Management needs the
\nflexibility to hire and fire workers while workers need the
\nsecurity of jobs, or at least the knowledge they will receive
\nfitting compensation if laid off. The concerns should be included
\nin any collective labor agreement.<\/p>\n
While there are the many companies which do not afford their
\nworkers the luxury of the agreement, those that do often slant it
\nso markedly to their advantage that workers feel no obligation to
\nthe terms when the crunch comes. A collective labor agreement
\nshould be negotiated between two equal partners, wherein lies the
\nargument for a labor union that is strong and independent, not
\nrepressed and controlled as in the past.<\/p>\n
The crisis has also exposed the fallacy of the cheap labor
\npolicy. Since wages make up a relatively small percentage of
\ntotal costs, employers often manage to weather the recession
\nwithout having to retrench their workforce. Layoffs are a last
\nresort not only because of likely strong resistance from workers,
\nbut also because the costs of keeping them on are relatively low.
\nThe cheap labor policy in Indonesia comes with its own price tag
\nin inflexibility in hiring and firing workers. At a time of
\ncrisis, rigidity is a liability that undermines any competitive
\nadvantage Indonesia wields abroad.<\/p>\n
As Indonesia becomes part of a global economy, it is high time
\nthe country -- the government, employers and labor unions -- take
\na completely new approach to our labor policies. There is plenty
\nof work to be done on the labor front. The government at least
\nhas shown it has the goodwill.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/a-goodwill-gesture-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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