Minimum wages to rise in April

Minimum wages to rise in April

JAKARTA (JP): The government announced yesterday it will raise
minimum wage levels by between 10 percent and 35 percent in 19
provinces as of April 1.

Despite the positive aspects of the move, the All Indonesian
Workers Union (SPSI) was quick to denounce the raises decreed by
Minister of Manpower Abdul Latief as short of workers' expectations.

The minimum daily wage level in Jakarta has been raised by a 21
percent from Rp 3,800 to Rp 4,600. Union activists had earlier
expected to see an increase to at least Rp 5,000, which they argue
is in line with the high cost of living in the capital.

Still many see the increases as a welcome development.

Latief said yesterday that the increases are intended to bring the
minimum wage level to the bare minimum subsistence level in order to
meet the minimum physical requirements of workers.

The announcement by his ministry stipulates that when the hikes
are affected this April 1, the minimum wage levels will equal 107
percent of the minimum physical requirements.

The government plans to phase in more increases in the coming
years to bring the minimum wage to levels that will afford workers
their needs, including education and health care.

The minimum wage level is set for a seven-day or 40-hour working
week and is calculated on a 30-day basis. This means that a worker
in Jakarta should take home at least Rp 138,000 a month beginning
next April, up from Rp, 112,000 at present.

The minimum wage level includes up to 25 percent in allowances,
but excludes incentive bonuses.

Latief told The Jakarta Post yesterday that the increases for the
other eight provinces will soon be announced. "We are waiting for
the proposals from the provincial administrations."

The minimum wage levels are negotiated in each region by
representatives of the SPSI and of the Apindo association of
employers. The process is mediated by government officials.

Latief said the raises were announced three months ahead of their
enforcement to allow employers ample time to prepare.

"I don't want to see any companies delaying the enforcement of the
minimum wage. They must abide by it on April 1," he insisted.

Under the current law enacted in 1969, employers who fail to pay
their workers the minimum wage level could be jailed for up to three
months, or required to pay a fine of Rp 100,000. Latief's office is
currently drafting a new labor law that seeks a stiffer penalty.

The minister recalled that last year many companies in Jakarta and
West Java delayed raising the wages of their workers by complaining
that they were not given enough time to prepare for the hikes. The
delay caused industrial labor actions to plague many companies in
Jakarta and West Java.

"Now, there's no excuse whatsoever for them to delay," he said.

Apindo's chairman Suratno Hadisuwito yesterday said his
organization welcomed the increases because they were the results of
negotiations with the union representatives.

"We will abide by the regulations," he said.

The increase is expected to not only improve workers' welfare, but
also their productivity, he added.

But SPSI Deputy Chairman Saman Sitorus complained that the hikes
were barely sufficient to cover the runaway cost of living. "What
can Rp 4,600 buy in Jakarta?," he said of the new minimum wage level
for the capital city. "It is enough only for a lunch."

He proposed that the government study the actual daily needs of
workers before setting the minimum wage levels.

The Indonesian Prosperity Labor Union (SBSI) also joined in the
criticism for the government's failure to raise workers the increase
they are entitled.

In a statement, SBSI said the ideal minimum wage level in Jakarta
is Rp 7,000 a day. That's for a single worker. Workers with families
should get more than that, it said.

While the hikes announced are welcome, SBSI said it will continue
to fight for an even higher increase workers wages.(rms/emb)