Jakarta – More than 105 companies, roughly 15 percent of the listed companies in Madiun, East Java, are paying employees below the District Minimum Wage (UMK) this year, an official says.

The companies paying below the minimum wage of Rp 720,000 (US$81.60) were mostly small enterprises, Madiun district assistant Agus Pramono said Monday as quoted by kompas.com.

However, the district says it has no plans to sanction these companies even though they have violated its wage regulation.

"We will not take action against [the employers] because if this law were enforced we are concerned it could lead to the termination of many workers' employment contracts," Madiun assistant district Agus Pramono said Monday as quoted by kompas.com.