Jakarta – Jakarta's factory workers and laborers will be getting a pay raise this month, but it falls short of accommodating higher-priced commodities amid soaring inflation.
The provincial monthly minimum wage is to increase at rates ranging from 5 percent to 8 percent in designated industrial sectors, effective as of Jan. 1.
The average increase is from Rp 711,843 (US$71) to Rp 819,100 – still lower than the Rp 824,026 in neighboring Bekasi.
The increase – determined from a series of tripartite meetings between local manpower officials, labor union representatives and businesspeople – is also considerably lower than the national year-on-year inflation rate of 17.11 percent for 2005.
Labor representatives had sought a 20 percent increase.
"The governor agreed to the wage board's recommendation to increase the minimum wage... And, of course, it won't please everybody," Jakarta Manpower Agency head Ali Zubeir said on Monday.
National Labor Union chairman Suparman said the increase was the best that could be expected under the difficult economic circumstances.
"This is the answer. We understand that many industries are in crisis due to the recent fuel price hike and rising inflation rate."
Minimum wage rates were determined by the manpower ministry until the implementation of regional autonomy in 2001; they have since been fixed by tripartite committees with the approval of the governor.
Gubernatorial Regulation No. 2444/2005, signed on Dec. 30, 2005, determines varying increases for four different major industrial categories (small and medium scale industries can continue to use the 2005 standard).
The first category – covering food, drink, tobacco and textile industries – has a minimum wage of Rp 860,055.
A minimum wage of Rp 868,246 is in effect for workers in construction, nonforeign exchange banks, fuel and carpet industries.
Those employed in industries producing automotive and bicycle equipment, pharmaceuticals, dairy products, paint, soap, household cleaners and cosmetics are entitled to a minimum wage of Rp 876,437.
The highest increase – Rp 884,628 – is reserved for workers in industries producing heavy equipment and electrical devices.
Ali said four companies – Eva Sari Hospital, PT Mas Huri, the Workers Cooperative of LIA Foundation and PT Catur Nusantara – have filed objections to the new wage rate due to financial problems, but he warned businesspeople to abide by its implementation.
"For companies that object to the increase in the minimum wage of their employees, they must first discuss the matter with their respective labor unions. If they fail to do so, then I will send them warning letters."