Employers objects the increase of workers' minimum wage

Employers objects the increase of workers' minimum wage

Annastashya Emmanuelle, The Jakarta Post, Jakarta

Workers' hopes of enjoying a 38.7 percent increase in the
minimum wage here next year will likely not materialize as
employers have rejected the hike.

The Indonesian Employees Association (Apindo) even threatened
to sue Jakarta Governor Sutiyoso at the Jakarta State
Administrative Court for issuing a decree increasing the
provincial minimum wage from Rp 426,250 to Rp 591,266, starting
next year.

Not only did they reject the decree, they also claimed that
they had never approved the increase during the meeting between
labor unions, employers and officials from the Ministry of
Manpower.

Representatives from Apindo and the Jakarta Chamber of
Commerce and Industry (Kadin) who were present at the meeting
said they did not sign any agreement on the proposed increase,
and therefore the decision was made without their consent.

"In the meeting, we stuck to our proposal of Rp 490,000 per
month, and didn't sign anything. The new minimum wage was
decided entirely by the government and the labor unions," Anita
Gizelle, from the Jakarta Chamber of Commerce and Industry told
employers from various business sectors in a gathering convened
by Apindo and Kadin.

An executive of the Indonesian Retail Merchants Association
said last week that employers represented in the city's wage
committee only approved the steep wage increase due to the
limited time allowed for negotiations with the other parties
involved.

According to the gubernatorial decree on the provincial
minimum wage, the increase is to take effect on January 2002.

Labor unions had proposed the sum of Rp 600,000, which they
arrived at based on results of a basic needs survey.

According to the deputy chairman of Apkindo, Haryadi
Sukamdani, the reason for taking the case to court was to stall
the scheduled implementation of the decree early next year, thus
buying time for further negotiation until the court reached a
verdict.

"We will file the suit as soon as possible since January is
very near ... meanwhile, we'll also review our participation in
the committee. As we have often been disregarded, we are
considering withdrawing from the committee," Haryadi told
reporters on the sidelines of the discussion.

Meanwhile, businesspeople at the gathering agreed to oppose
the new ruling on the grounds that the economy had not yet
recovered.

"In time, this would kill the manufacturers in Jakarta and
with that comes massive unemployment," said Toto, from the
Electric Cable Manufacturers Association.

Another businessman said that the government was unable to
accommodate the interests of all sides and often failed to take
into account the situation of employers.

"Perhaps this kind of proposal could be considered if the
government was willing to postpone the increase in fuel and
electricity rates which will also take place next year," Asima
Sitorus from the Association of Synthetic Fiber Producers
commented.

Sutiyoso had earlier rejected the review of the decree on the
2002 minimum wage, but allowed employers who could not afford the
hike to file an objection and send in their financial reports.