Page 54 - E-KLIPING KETENAGAKERJAAN 17 NOVEMBER 2021

UNIONS PLAN PROTESTS OVER MINIMUM WAGE

Labor unions are planning to take to the streets before the end of the year to protest against
the monthly minimum wage hike for 2022, which is below expectations.

Unions had proposed wage hikes of between 5 and 20 percent, but were let down by the
Manpower Ministry’s recent announcement that wages would be raised by an average 1.09
percent nationwide, as per prevailing regulations.

The ministry noted that, as of Monday, 22 provinces had set next year’s minimum wage. Jakarta
raised its minimum wage by 0.85 percent to Rp 4.45 million (US$313.26), the highest compared
with the other provinces, while Central Java increased it by 0.78 percent to Rp 1.81 million, the
lowest.

“If we look at the cost of daily necessities in a month, it does not make sense to have a wage
below Rp 2 million,” Congress of Indonesia Unions Alliance (KASBI) chairwoman Nining Elitos
told The Jakarta Post on Tuesday, adding that KASBI planned to hold protests this month.

Similarly, the Confederation of Indonesian Trade Unions (KSPI), Confederation of Indonesian
Prosperity Trade Unions (KSBSI) and Indonesian Workers Union Association (Aspek) have
declared their opposition to the latest minimum wage hike.

KSBSI and Aspek did not mention protest plans, but KSPI chair Said Iqbal said on Tuesday that
his organization would hold a simultaneous street protest across the country in early December,
possibly in the first week of December.

Leading up to the national demonstration, unions also plan to hold demonstrations at regional
leaders’ offices, and conduct work strikes, “effectively halting production at factories as a protest
against the latest minimum wage decision,” he said.
The Manpower Ministry’s finalization brings an end to months of back and forth between
employers and workers over the minimum wage hike after Government Regulation (PP) No.
36/2021 on wages was issued in February.

The regulation, a derivative of the Jobs Creation Law, stipulated that the regional economic
growth rate or inflation rate be used as the rate for calculating the minimum wage increase. Prior
to this legal framework, regional administrations would raise it by the economic growth rate plus
the inflation rate.
Manpower Minister Ida Fauziyah defended the new minimum wage formula, saying it was meant
to better reflect the relationship between the wage and economic indicators, such as average
household spending and unemployment rates.

“The spirit of the formula [..] is to reduce the inequality between minimum wages so there is
fairness among regions,” Ida said in a virtual press briefing on Tuesday.

The ministry finalized the wage hike after Statistics Indonesia (BPS) released earlier this month
the latest inflation figures.

Hariyadi Sukamdani, the chairman of the Indonesian Employers Association (Apindo), said on
Nov. 2 that businesses supported setting new minimum wages as per the Jobs Creation Law,
which was still legally valid despite an ongoing Constitutional Court challenge.

“The current formula is appropriate. [It is based on] a calculation of average household
spending,” Hariyadi said in a press briefing.

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