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Workers insist on using cost of living survey for pay raise

Jakarta Post - October 13, 2016

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Agnes Anya, Jakarta – Employers and workers have yet to reach an agreement on the 2017 provincial minimum wage as the two parties are using different calculation methods.

The Jakarta tripartite wage committee, which comprises city administration officials and representatives of employers associations and labor unions, gathered at City Hall on Wednesday for an annual discussion on the minimum wage.

Jakarta's Chamber of Commerce and Industry (Kadin Jakarta), representing employers, suggested that next year's provincial wage be set at Rp 3.35 million (US$257.34), 8.1 percent higher than the current Rp 3.1 million.

The proposed amount was formulated based on Government Regulation (PP) No. 78/2015 on minimum wages, which stipulates that the annual minimum wage increase should be based on the city's inflation rate and economic growth.

Meanwhile, workers, represented by the Jakarta Labor Movement (GBJ), insisted that the minimum wage should be raised by 23 percent to Rp 3.83 million. The figure was based on their own survey of the city's basic cost of living (KHL).

The survey found that at the bare minimum, Rp 3.49 million per month was needed to live in the capital in 2016. By calculating other components including inflation outlook and economic growth, the labor unions eventually decided that the minimum wage should be set at Rp 3.83 million.

The administration has yet to reach a decision as the meeting ended in a deadlock, said the head of the Manpower and Transmigration Agency Priyono, adding that another meeting would be held next week. The Jakarta administration must set the minimum wage by early November.

"If next week we still disagree on the amount, we will just propose two options and the governor will choose between them," said Kadin Jakarta deputy head Sarman Simanjorang.

Sarman said he hoped Jakarta Governor Basuki "Ahok" Tjahaja Purnama would use the amount suggested by the employers, as their calculations had a legal basis.

"Basically, we set the amount based on a regulation stipulated by the government, so we expect the governor to be consistent in upholding the rule," he said.

Meanwhile, Jayadi, the workers' representative at the meeting, said they were aware they were facing an uphill battle. He said workers knew Ahok must uphold the regulation, but they insisted that the governor was chosen by the people and should hear the people's aspirations.

Previously, Mirah Sumirat, president of the Indonesian Workers Association (ASPEK), said Jakarta should have the highest minimum wage as it played a large role in the nation's economy.

The fact that the capital had a lower minimum wage than its satellite cities, including Bekasi and Karawang in West Java, was unacceptable, she said. Bekasi city's 2016 minimum wage is Rp 3.32 million, while the current minimum wage in Karawang is Rp 3.33 million.

"It clearly shows that the city administration and businesspeople pay little attention to workers' conditions. The survey results should play an important role in determining next year's minimum wage," she said.

Source: http://www.thejakartapost.com/news/2016/10/13/workers-insist-using-cost-living-survey-pay-raise.html.