City minimum wage up Rp 40,000
Bambang Nurbianto, The Jakarta Post, Jakarta
The Jakarta minimum wage is to increase by 6.3 percent next year from this year's Rp 631,000 (US$75.1) to Rp 671,550. The increase is expected to be effective starting Jan. 1.
Head of the Jakarta Manpower and Transmigration Agency Ali Zubeir told the press at City Hall on Thursday that the increase in the minimum wage was stipulated in Gubernatorial Decree No. 3654/2003 issued on Oct. 31.
Ali said the governor's decision was based on the proposal of the City Wage and Social Safety Committee, which is authorized to study wage issues in the city.
Members of the committee include union representatives, employers and city administration officials.
Ali said the committee had held several meetings to discuss the city minimum wage since April 30. He, however, did not go into details about how the figure of 6.3 percent was reached.
The new minimum wage does not include weekly transportation and meal allowances paid by the companies every week.
In the decree, the governor also prohibits companies from cutting wages which currently exceed the new minimum wage in the city.
He said that the city administration still gives the opportunity to companies which want to propose a delay in the implementation of the new minimum wage.
Ali said those companies could submit a proposal to delay the implementation to the Jakarta Manpower and Transmigration Agency no later than Dec. 21.
He said companies should enclose a number of documents to support their request for a delay.
First, the proposal should enclose a letter of agreement from union workers. If there is no union at the company, the proposal should be approved by at least 50 percent of workers who receive the minimum wage.
Second, a copy of the company's founding certificate. This requirement is only for companies that employ over 100 employees.
Third, data about production and sales for last two years and production and sales forecasts for the next two years.
Fourth, data about the salary scale based on position.
Fifth, data on the number of employees who would be affected by the delay.
And sixth, the readiness of the company to pay their employees based on the new wage schemes after the grace period expires.
The company may delay the implementation of the minimum wage for up to one year.
Meanwhile, a number of labor unions in the city expressed disappointment with the increase, saying that the figure would not cover the basic needs of workers in the city.
In their statement, the unions pointed out that based on the result of a survey conducted by the unions' wage commission, the minimum wage for Jakarta should be Rp 722,356.
The unions also demanded the implementation of the minimum wage according to the business sector, based on a recommendation in a 1999 manpower ministry decree on the minimum wage in relation to the business sector.
According to the unions' calculation, the workers in the metal, electronics, electric and automotive industry should receive a minimum wage of Rp 758,476, while workers in the chemical, energy and mining sector should receive Rp 845,992. Workers in the pharmacy and health sector should receive 5 percent more than the general minimal wage. And workers in the textile and leather sector should receive Rp 758,476.
The workers threaten to hold a mass demonstration to press for their demands.