Firms warned about linking wage hikes with productivity
Firms warned about linking wage hikes with productivity
JAKARTA (JP): A senior official of the Ministry of Manpower
warned companies yesterday against linking productivity to pay
increases in the official minimum wage level.
Director General for Supervision, Training and Productivity
Andy Sangaji said yesterday that the government's decision to
raise the minimum wage levels on April 1 has nothing to do with
productivity.
Andy pointed out that the minimum wages were calculated on the
basis of the minimum physical requirements.
People cannot expect workers to be productive if they can not
make ends meet, he said.
The government announced on Tuesday that it would raise
minimum wage levels by between 10 percent and 35 percent in 19
provinces as of April 1. The new wages, ranging between Rp 2,800
(for Central Sulawesi) and Rp 4,600 (for Jakarta and West Java),
equal about 107 percent of the estimated minimum physical
requirements in each region.
The chairman of the East Java chapter of the All Indonesian
Workers Union (SPSI), Soedariyanto, said the new minimum wage
levels should be enforced if necessary.
The daily minimum wage in East Java, which will be increased
from Rp 3,250 to Rp 3,700, was not really adequate, Soedariyanto
said. "Ideally the take-home pay of a worker in the urban area of
East Java would be between Rp 4,500 and Rp 5,000 a day," he was
quoted by Antara as saying.
Soedariyanto, who is also a member of the Surabaya legislative
council, called for the dissemination of information on wage
increases so that both business people and the workers will be
aware of their rights and obligations regarding the new policy.
He called upon business people to comply with the regulation
on the new wage levels without making excuses. SPSI, he added,
will make sure that those who fail to comply will be punished.
There are more than 8,300 companies with about 600,000 workers
in East Java. SPSI is represented in 1,670 of the companies.
The Indonesian Legal Aid Foundation (YLBHI) meanwhile
criticized the government for using the minimum physical
requirement as the yardstick in setting the minimum wage level.
The method is not only out of date but also goes against the
social and economic reality of today's workers, the foundation
stated yesterday.
Even if the government raised the minimum wage levels by 100
percent, this would still be far from adequate because the
government applied the standard of minimum physical requirements
which was exercised 40 years ago, said the statement by Hendardi,
YLBHI's director of communication.
Gap
Hendardi suggested that a more appropriate method would be to
reduce the gap between the salary of the top executive in a
company and the lowest wage of its workers. He said this gap
appears to be increasing at an alarming rate. In the sport shoe
industry a top executive could earn as much as 200 times the
lowest wage earner, he said.
He proposed that an independent wage council be set up to set
minimum wage levels.
At present, these levels are set at every province through
negotiations involving representatives of SPSI, employers and the
government.
YLBHI also called for better supervision to ensure compliance
with minimum wage levels because the current system is weak and
excludes workers.
It recalled that in the past many workers who demanded the
minimum wage ended up being dismissed or even arrested by the
authorities.
YLBHI acknowledged the complaints most often cited by
companies was the need to suppress workers' wages due to other
costs to cover, known as the invisible costs to pay bureaucrats
to avoid excessive red tape.
"As long as the invisible costs exist, the workers will never
enjoy our industrial growth," YLBHI said.(sim)