Jakarta – The Jakarta city Manpower and Transmigration Agency has proposed using an old formula to decide the 2016 minimum wage by taking into account items in the cost of living [KHL] in the city, instead of the fiscal year's inflation and gross domestic product (GDP) growth formula as stipulated in the government's fourth economic package.

Agency's head Priyono has said that before the central government announced the forth economic package, last week, the Jakarta Wage Council carried out a survey to figure out the items that would be on the KHL list.

"The results of the survey would be included in the documents that would be sent to Jakarta Governor Basuki 'Ahok' Tjahaja Purnama for consideration in deciding next year's Jakarta provincial minimum wage," said Priyono after meeting with members of the Jakarta Wage Council in Jakarta on Wednesday.

He said the central government had not issued a governmental regulation on the wage system, which would be a follow-up on the fourth economic package. "As long as there is no new government regulation, the old formula should decide next year's wage," he added.

Previously, a number of trade unions also rejected the new formula, saying that it would sluggishly improve employees' welfare. Confederation of Indonesian Workers Unions (KSPI) chairman Said Iqba said that assuming 2015 inflation was 5 percent and GDP growth rate was 5 percent, there would be a 10 percent annual rise in wages for 2016. He demanded the government also to consider the 84 items in the KHL. (bbn).

Source: http://www.thejakartapost.com/news/2015/10/22/jakarta-may-use-old-formula-decide-wage-increase.html