Sutiyoso delays approving capital's new minimum wage

Sutiyoso delays approving capital's new minimum wage

Damar Harsanto, The Jakarta Post, Jakarta

Governor Sutiyoso has delayed approval of the 2005 provincial
minimum monthly wage pending an agreement between the employer's
association and the worker's association.

"The proposed figure of Rp 711,843 (US$78.66) was the result
of discussion at the provincial wage council. However, the 21
members of the council failed to reach a compromise so we are
still waiting for that," the governor said on Tuesday at City
Hall.

Sutiyoso said he had ordered City Manpower Agency head Ali
Zubeir to consult with the Ministry of Manpower on the new
minimum wage. The ministry issued a circular on July 16 stating
that the new provincial minimum wages should be the same or
higher than the minimum living costs in the respective provinces.

"We will wait for direction from the ministry to resolve this
dispute," the governor said.

Zubeir confirmed that he had been ordered to consult with the
ministry, put said he did not expect the meeting would result in
significant changes to the proposed minimum wage.

"It is an ordinary consultation meeting to seek clarification
about the minister's circular," he said.

He added that there would be no revision to the proposed
minimum wage hike. "We will stick to the figure (Rp 711,843) ....
There will be a media release on Thursday," he said.

Sutiyoso said earlier he would approve the proposed new
minimum wage, which would be a 6.50 percent increase from the
previous monthly minimum wage of Rp 671,550, indicating he saw no
significant obstacles to the increase.

During the latest discussion on Nov. 5, 14 representatives of
the employer's association and the city administration voted for
the new Rp 711,843 wage. Seven representatives of the worker's
association walked out of the discussion in protest. However, the
employer's association and the administration went ahead with a
vote on the issue.

The worker's associated is demanding that the minimum wage be
at least Rp 759,953, which is the official minimum cost of living
for Jakarta.

That figure was reached in a joint survey in July by
representatives of the administration, the worker's association
and the employer's association.

Earlier, workers demanded the monthly minimum wage be
increased to Rp 1.2 million.

The chairman of the Indonesian Employers Association, Sofjan
Wanandi, said the employers hoped the wage increase would not
exceed the rate of inflation in Jakarta, which is expected to be
about 6.5 percent this year.

The city administration has said the wage increase must take
into account the interests of everyone involved, arguing that an
overly generous increase that could end up harming business
activity here.

According to data from the City Manpower Agency, about 25,000
private firms operate in the city, employing approximately four
million people. The data also shows that open unemployment in
Jakarta is about 589,700.