Daily basic wage level up by 10%
Daily basic wage level up by 10%
JAKARTA (JP): Minister of Manpower Abdul Latief said yesterday
that the government will increase the regional daily minimum wage
level nationwide by ten percent as of April next year.
"We will increase the regional daily minimum wage level
nationwide from 97 percent to 107 percent of the workers' minimum
physical needs," Latief said in a hearing with Commission VI of
the House of Representatives (DPR).
However, he told the commission, which deals with industrial
and labor affairs, that the government would gradually increase
the minimum wage level by 15 percent or equal to the required
minimum needed by the workers.
Members of the commission welcomed the government's plan to
increase worker's regional daily minimum wages.
Iskandar Mandji, a Golkar legislator, even demanded an
automatic proportional increase in minimum wages for each
production sector.
"Every employer must be able to calculate the automatic
increase in wages each time the government hikes certain tariffs,
such as its usual increases in electricity billing rates," he
said.
Latief said the government would object to some multinational
companies' move to relocate their factories to Indonesia if their
motive was simply cheap labor.
"The government cannot accept any multinational company's
policy to keep working wages low while their production costs are
in fact also low," he said.
"How can we talk about productivity when the workers are
hungry?" he added.
Farid Akhwan, also a legislator of the Golkar faction, agreed
with Latief's argument.
"Productivity will automatically follow the workers' level of
welfare." he said.
In many regions, including Jakarta and West Java, the minimum
wages are now close to meeting the worker's minimum physical
needs, which are calculated on the basis of local consumer index
prices.
But in a number of regions, the minimum wages are still barely
60 percent of what is minimally needed to survive.
The regional daily minimum wage for the greater Jakarta area
was raised in January to Rp 3,800 (US$1.8) from a previous Rp
3,000.
However, it is still below that of Batam, a flourishing
industrial designated zone south of Singapore, and Irian Jaya,
with the minimum daily wage set at Rp 6,750 and Rp 4,500,
respectively. Batam and Irian Jaya rank as the two highest
minimum wage levels in the country.
Review
Latief said the government was currently reviewing the minimum
wage regulations and strengthening punitive measures against
violators to ensure greater compliance.
He said the government had drafted a bill which includes
stronger penalties for violators, usually those failing to pay
the minimum wage. The bill is expected to be ready for
deliberation in April.
Under the present regulation enacted in Law No. 14/1969, a
company owner who does not pay his workers the required minimum
wage faces a maximum of three months in jail, or a fine of Rp
100,000.
Latief said the government will not hesitate to prosecute
company owners who ignored the minimum wage regulations. The
regulations allow for exceptions if the companies' finances
prevent them from paying the minimum wage levels.
He said companies seeking to be exempted must prove in court
that they truly could not pay the minimum wages.
Meanwhile, Director General for Labor Standards and Industrial
Relations Suwarto said after the hearing that 16 companies had
been fined for failure to pay the minimum wage and to comply with
other government labor regulations.
He said another 94 companies were either being prosecuted or
investigated for violating the regulations. (imn)