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Minister Muhaimin forms task force to anticipate labor layoffs

Source
Jakarta Globe - January 16, 2013

The Manpower and Transmigration Ministry has established a task force to monitor the threat of job dismissals following the implementation of monthly minimum wage standards considered as too burdensome by industries, the ministry said on Wednesday.

"Our task force is continuously monitoring, so that not a single job dismissal takes place because of the rising monthly minimum wage standards," the Manpower and Transmigration Minister Muhaimin Iskandar said in a ministry release.

"This task force will conduct early detection so that the application of the 2013 minimum wage standard will not disturb the performance of companies and not lead to job dismissals."

Muhaimin said that the task force will coordinate with manpower offices across the country to collect information, data and provide counseling in anticipation of dismissals due to the higher wages.

He said that if companies had no other way but to resort to job dismissals because of the high wage levels, they could coordinate with the local manpower office which would help seek solutions, including through possible postponement of the new wage levels.

"Most important is to prevent and avoid layoffs of workers in relation to the minimum wage standards," he explained. "Manpower offices in the region will help check, together with enterprises and workers unions, whether the company is really hurt and unable to pay its workers under the new wage standard."

He also said that the unions and the enterprises should also coordinate between themselves and try to seek solutions that would prevent layoffs.

"I hope that the rising workers' wage does not become a burden for the companies and therefore there should be incentives from other sectors. Let us, for example, encourage tax incentives, infrastructure improvements, logistics and banking interest rates for the companies," he said.

The minister said that a recent meeting organized by the top economic minister had resulted in an order for him to revise a ministerial decree on the process to obtain a deference of the implementation of the minimum wage standard.

"Let us all seek ways out so that the burden of the enterprises in 2013 is alleviated, but not by merely blaming the wage level of the workers, which are actually not yet at their maximum. We should seek a way out by applying incentives, to those companies," Muhaimin said.

The Jakarta administration decided to set the capital's minimum wage at Rp 2.2 million ($228) a month last November.

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