Tangerang will likely see 10% wage hike next year

Tangerang will likely see 10% wage hike next year

Multa Fidrus, The Jakarta Post, Tangerang

While the Jakarta administration has decided to increase the
minimum wage by 7 percent starting in January, Tangerang, whose
current minimum wage is similar to Jakarta's, will likely
implement a 10 percent increase in 2003.

A tripartite committee consisting of representatives from
labor unions, employers and the Tangerang municipal manpower
agency, agreed on Wednesday to issue a recommendation to the
Tangerang mayor for an increase in the minimum wage of about 10
percent, from Rp 590,000 to Rp 649,000.

Independent labor activists agreed with the 10 percent
increase, even though they said that if approved the new minimum
wage would still not be enough on which to live.

Kasmina, chairwoman of the workers union at PT Hyun Indonesia
Garment, said workers agreed not to ask for more money because
they realized businesses were suffering from the sluggish economy
and they wanted to avoid massive layoffs.

"We want the relationship between workers and businesses to be
maintained, even though the workers are placed in a bad position
whenever they ask for more money," she said.

Citing a wage survey conducted by the Federation of Karya
Utama Labor Associations (FSBKU) between May and September 2002,
Kasmina said the minimum monthly spending of workers in Tangerang
ranged between Rp 800,000 and Rp 1,200,000, far above the
proposed new minimum wage of Rp 649,000.

"If the Tangerang mayor approves the proposed 10 percent wage
increase, the new wage will only cover 50 percent of the total
actual spending of workers," Kasmina told The Jakarta Post.

Data from the Tangerang Manpower Agency shows that eight
companies in the municipality went out of business in 2001 and 11
shut down this year.

Currently, there are 1,419 companies in the Tangerang
municipality.

Yusuf Makatita, chairman of the Tangerang branch of the
Indonesian Workers Association (SPSI), said the proposed 10
percent wage increase was based on a recent statistical survey
that predicted inflation here would reach 9.5 percent this year.

Helmi, of the Tangerang branch of the Indonesian Employers
Association (Apindo), told the Post that employers agreed to a
wage increase that used the Jakarta minimum wage as a reference
point.

Meanwhile, the Tangerang municipal manpower agency chief,
Adang Turwana, said Mayor M. Thmarin would likely approve the
proposed 10 percent increase in the 2003 minimum wage.

He said the minimum living expenses (KHM) in Tangerang was the
main factor in deciding the new minimum wage. There were five
other factors considered in the decision: the price index, the
health of local companies, minimum wage in Tangerang's
surrounding areas, the condition of the job market and overall
economic progress.

He said a joint survey by the tripartite committee on the
price of 43 basic goods at three markets in Tangerang between May
and October 2002, concluded that the KHM in Tangerang was Rp
614,504.

"If Mayor M. Thmarin is willing to approve a new wage above Rp
614,504, it means that the mayor has the political will to
improve the welfare of workers," he told the Post.

Separately, Hamdani Malik, chief of industrial relations at
the manpower agency in Tangerang regency, said his office would
hold a tripartite committee meeting involving employers and labor
unions to discuss the regency's 2003 minimum wage on Monday.

"But the wage hike in the regency will not be far different
from the newly approved Jakarta minimum wage," he said.

There are 2,363 companies operating in the regency. Last year,
three companies reported the closure of their businesses to the
agency, while so far this year that number is four.