Minimum wage may increase 13% next April

JAKARTA (JP): The Ministry of Manpower's city office has called on the administration to increase the minimum wage 13 percent because the current rate "does not meet basic living expenses".

The office's head of industrial relations and work requirements, Resbin L. Sihite, said the minimum monthly wage in Jakarta of Rp 172,500 (US$43.12) covered only 96 percent of basic needs as set out in the ministry's standard.

"Based on our calculations, the increase of 13 percent will meet the requirements of basic living expenses."

Resbin said he hoped the new wage would be introduced in April.

The calculations take into consideration the cost of food and drink, housing and related items, clothing and various needs such as transportation, recreation, medicine and education.

Food expenses were based on the price of rice, meat and sugar. The housing category took into account the price of renting a house or room, plus plates, glasses and spoons. The cost of clothing included fabrics T-shirts, sarongs, sandals, soap and shoes.

Resbin said that 41 companies wanted to postpone this year's increase of the minimum wage because of their inability to pay.

But the manpower office had only given permission to 28 companies which it considered were unable to afford the increase.

He said the postponement proposals of nine companies were rejected, while four others rescinded their applications.

Resbin said that the permits for companies to postpone pay increases were temporary, varied from three months to one year.

"After that period the companies should meet the standard minimum wage."

He said that before the new wage was implemented, the office would start publicize the change in January, holding discussions and explaining how it was calculated.

A team of experts on wages had studied the increase, he said.

Dismissal

Resbin said three companies in South and North Jakarta had submitted proposals to dismiss 310 of their workers this year.

But his office had not decided whether to grant the permits.

He urged the companies to avoid worker dismissal.

"There are still other ways, including decreasing shifts and overtime work or channeling workers to other divisions in the same group."

Resbin said that 14 of the 16 liquidated banks had also submitted proposals to the office to dismiss 8,994 of their workers.

Bank Andromeda, one of the 16 liquidated banks, had reassigned its workers to Bank Alfa, and Bank Pinaesaan did not submit a proposal for the dismissal of its workers. (ind)