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The method is not only out of date but also goes against the social and economic reality of today's workers, the foundation stated yesterday.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)