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Perppu on Job Creation angers workers, employers
The Labor Party said the formula for minimum wage in the regulation did not follow international standards as the government included “certain indexes” variables that were not stated in the International Labour Organization (ILO).
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Inspecting emission level: A mechanic at Astra Motor center repair shop in Cawang, East Jakarta, carries out an emission test on a motorcycle. (JP/Wulan Kusuma Wardhani)
The new minimum wage regulation draws ire from both workers and employers, who say that it has created legal uncertainty.
Labor Party chairperson Said Iqbal explained that Perppu No. 2/2022 on Job Creation did not end the controversy surrounding minimum wage that has warmed industries in the last few months.
Before the introduction of the Perppu in December 2022, workers protested the minimum wage set by the local administrations for this year, as the average rise was below the unions’ proposal at 13 percent. In November, the government issued the Manpower Minister Regulation (Permenaker) No.18/2022 that set the minimum wage at 10 percent, factoring inflation in the calculation.
The government’s decision later met resistance from employers and they have formally filed lawsuits against the regulation.
“The Labor Party denounces Perppu’s regulation on minimum wage,” Said told reporters on Wednesday.
He said a governor could still opt not to raise the minimum wage in cities and regencies if the lower-level administrations set low wages since the Perppu only used the word “able.”
Said calls for the government to remove the word “able” in the Perppu so governors are forced to determine the rate hikes, lessening the uncertainty.
