Anastasya Lavenia Yudi, Jakarta – The Confederation of Indonesian Trade Unions (KSPI) has rejected the Draft Government Regulation on Wages, which will serve as the basis for determining the 2026 provincial minimum wage (UMP).
The government is scheduled to announce the UMP provisions on Tuesday, December 16, 2025.
KSPI President and Labor Party leader Said Iqbal outlined several reasons for the union's opposition. He said the regulation was not meaningfully discussed with labor groups during its formulation.
According to Said, consultations with labor representatives took place only once.
"As a result, public participation, especially from labor unions, was not properly included in the drafting of the wage regulation that will determine the 2026 minimum wage increase," he said during a virtual press conference on Tuesday.
Said also warned that the draft regulation could undermine the principle of a decent standard of living. He argued that its definitions and calculation mechanisms could prevent wage increases in regions deemed to have exceeded the upper limit, even as the prices of basic goods continue to rise.
In addition, Said referred to Constitutional Court Decision No. 168/2023, which affirms that minimum wage increases must be based on inflation, economic growth, and a fair adjustment index.
KSPI criticized the regulation's proposed index range of 0.3 to 0.8, saying it could significantly limit wage growth. If the lowest index of 0.3 is applied, Said said, the minimum wage increase would be only about 4.3 percent.
"Last year, the minimum wage rose by 6.5 percent. Are workers now expected to accept an increase of just around 4 percent?" he said.
KSPI presented four proposed options for the 2026 minimum wage increase. The first calls for a minimum increase of 6.5 percent, matching last year's adjustment.
The second proposes a 6-7 percent increase to help maintain workers' purchasing power.
The third suggests a 6.5-6.8 percent increase as a realistic compromise.
The fourth calls for raising the adjustment index range to 0.7-0.9, instead of the proposed 0.3-0.8.
Manpower Minister Yassierli said the government would announce the 2026 UMP provisions on Tuesday. He confirmed that the draft regulation has been submitted to President Prabowo Subianto for approval.
"It is already on the President's desk and is awaiting his signature," Yassierli said at the Presidential Palace in Central Jakarta on Monday, December 15. He expressed hope that the regulation would be signed on Tuesday, allowing the government to formally announce the new minimum wage framework.
Previously, Yassierli said the 2026 minimum wage would be set within a range, with provincial, city, and regency wage councils authorized to determine final figures based on regional economic growth.
He added that calculations would also factor in the cost of a decent standard of living, noting that the ministry has formed a special team to assess those living-cost indicators.
– Hendrik Yaputra contributed to the writing of this article.
Source: https://en.tempo.co/read/2073864/indonesian-trade-unions-reject-draft-regulation-on-2026-minimum-wag