Apindo pledges compliance with new wage rules

Apindo pledges compliance with new wage rules

JAKARTA (JP): The Association of Indonesian Employers (Apindo)
says none of its 9,000 members are against complying with the
minimum wage hikes scheduled to take effect next April.

"None of our members object to the government's decision to
increase minimum wage levels simultaneously across the country.
We will all comply with the deadline," APINDO Executive Director
Hadi S. Topobroto said on Saturday.

His words, however, may not be enough to guarantee total
compliance. Apindo, the only association of employers in the
country, covers just 9,100 out of an estimated 143,000 companies
in the country.

The government has been campaigning for total compliance by
companies ever since it announced the hikes in the minimum wages,
ranging between 11 and 34 percent, in Indonesia's 27 provinces.

The campaign aim is to warn employers that, based on past
experience, failure to comply could result in the staging of
widespread labor strikes.

Minimum wage levels are negotiated between local chapters of
Apindo and the All Indonesian Workers Union (SPSI) in each
province with the help of the local administrations.

By regulations, exemptions are permitted for companies that
are experiencing financial difficulties but this will mean
subjecting their books to close government inspection.

Hadi said the increase in the minimum wage was one of the
topics discussed at an Apindo consultative meeting in Balikpapan,
East Kalimantan, on Jan. 28-29. During the meeting,
representatives from the 27 provinces said they had no objection
to the wage increases set by the government.

Asked about the Apindo members who were reluctant to observe
the minimum wage levels in the past, Hadi blamed the short notice
given by the government, which barely gave companies enough time
to review their spending plans. Employers need at least three
months time to prepare, he added.

Many companies in Jakarta and industrial centers in West Java
were hit by worker strikes in the first two months of 1994
because employers failed to meet the minimum wage levels that
were raised on Jan 1, 1994. The employers then complained that
they were only given two weeks' notice.

Hadi said employers could not simply raise the wages
overnight. "We're not talking about millions of rupiahs here.
We're talking about billions of rupiahs."

Excuse

This year there will be no excuse for companies not to comply,
however, because they have been given ample time.

While Apindo cannot impose sanctions on its members who
resist complying with the labor laws, the government can and
will. Last year, a number of employers were prosecuted.

Hadi said the Apindo meeting last month also reviewed the
progress of their training programs set up for workers and
managers alike.

The project, launched in October, receives funding from the
World Bank, he said, though he declined to state the amount.

The meeting agreed to expand the projects now operating in
West Java, East Java and North Sumatra.

Hadi also lauded a proposal by President Soeharto to move
labor-intensive industries out of Jakarta and its surroundings to
provinces where wages are lower.

He said the proposal would be discussed at Apindo's next
monthly meeting. (rms)