Latief criticizes businessmen angry over wage decree
Latief criticizes businessmen angry over wage decree
JAKARTA (JP): Minister of Manpower Abdul Latief called over
400 entrepreneurs arrogant yesterday for threatening to sue him
for raising the minimum wage by 10.6 percent as of this month.
The leader of the Federation of All Indonesian Workers Union
(FSPSI), Bomer Pasaribu, also criticized the businesspeople, and
praised the new wage policy as an effort to end the exploitation
of Indonesian workers.
Latief affirmed the government would not back down on the new
ruling because the decree helps improve the welfare of workers.
"We will stick to our guns. Companies who have financial
trouble implementing the ruling may seek to postpone raising
their workers' wages through legal procedures," he said in an
interview with The Jakarta Post.
Labor-intensive small and medium-scale companies object to the
new minimum wage standard on the grounds that it could bankrupt
them.
Around 400 companies, all claiming to be in financial trouble
and led by the Indonesian Textile Association, have threatened to
sue the manpower minister for his decree.
The January decree, which became effective on April 1,
increased the daily minimum wage by 10.63 percent. It also
stipulates that the monthly salary of permanent workers accounts
for 30 working days, not 26 days.
Pointing to exploitation in the textile industry, Latief said
that 80 percent of textile workers are kept on daily wages for
years.
"Many of them have been even employed under such a status for
15 years," he said.
The textile association said recently that many companies in
its organization faced economic difficulties because
of fiercer competition on the world market and the rising price
of imported raw materials.
The minister, who is also president of the Alatif Corporation,
said no company has ever gone bankrupt after increasing its
workers' wages.
"It is true that many companies get into financial trouble or
even go bankrupt because of mismanagement or the inability to
compete in the market," he said.
He warned that the government will drop the cheap-labor policy
it pursued for the past 25 years to attract foreign investment.
"In entering the free trade era, both companies and workers
must be professional to be able to produce more competitive
products," he said.
He admitted that the current minimum wage level is still low.
"I am not seeking popularity from the minimum wage issue
because I was popular before being appointed minister by the
President three years ago. I just want to improve labor
conditions," he insisted.
Separately, FSPSI chairman Bomer Pasaribu said that employers
should stop exploiting their workers' weak bargaining position.
He said the common practice was "unethical and against the
Pancasila industrial relations.
"It is the companies' right to disagree, but they should abide
by the new ministerial decree on minimum wages to help create
industrial harmony in the country."
Bomer argued that the 10.63 percent wage increase did not
significantly contribute to a worker's real income because of the
recent increase in transportation fares.
"The average Rp 315 increase in their daily wage will be
absorbed by the Rp 200 to Rp 400 increase in bus fares," he said.
(rms)