Textile factories told to move to cheaper areas

Textile factories told to move to cheaper areas

JAKARTA (JP): Can't pay your workers the minimum wage? Then relocate your plant to areas where the official minimum wages are relatively lower.

That's the message given yesterday by Minister of Manpower Abdul Latief to 70 textile and garment manufacturers in West Java who raised objections to the increases in the minimum wages in their area from Rp 3,800 to Rp 4,600 a day effective April 1.

He suggested Central and East Java, where the official minimum wages, even after the raises, will still be Rp 3,000 and Rp 3,700 respectively.

There is another incentive why they should move, according to Latief. Land prices there are cheaper too.

But Latief, who was speaking to reporters after meeting Vice President Try Sutrisno at the Merdeka Selatan palace, made it clear that every employer should comply with the minimum wage regulations.

A few hours earlier, the chairman of the Association of Indonesian Textile Enterprises Bambang Yoga Soegomo told reporters after meeting with President Soeharto that more than 70 garment and textile companies in West Java are threatened with bankruptcy because of the raises in minimum wages.

Bambang said he had asked for temporary exemption from the wage increases for textile and garment companies given that they provide large employment opportunities.

He pointed out that many textile and garment companies in Indonesia are already in dire financial difficulties because their exports slumped last year.

Latief simply echoed what had already been suggested by President Soeharto early this month that labor intensive companies, including garment and textile, relocate to regions where the minimum wages are still relatively lower.

The proposal would also stop the migration of people to Jakarta and West Java and spread the workers more evenly between regions, he said.

The minister said so far his office had not received any formal request to be exempted from the minimum wage raises.

He said by regulation, companies which have financial difficulties could be exempted from the wage regulation but only after their books are audited by public accountants and with the consent of the workers. (rms)