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Jakarta Post

Ministry will not use 2023 regulation to calculate 2025 minimum wage

The Manpower Ministry has confirmed that Government Regulation (PP) No. 51/2023 will not be used as a reference for determining the 2025 provincial minimum wage (UMP), which is set to be announced before the end of December. 

News Desk (The Jakarta Post)
Jakarta
Thu, November 21, 2024

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Ministry will not use 2023 regulation to calculate 2025 minimum wage Calling for change: Workers take part in a rally in Jakarta on Oct. 24 demanding higher wages and the repeal of certain provisions of the Job Creation Law. (AFP/Juni Kriswanto)

T

he Manpower Ministry has confirmed that it will not use Government Regulation (PP) No. 51/2023 as a reference for calculating minimum wage, including the upcoming 2025 provincial minimum wage (UMP).

This decision aligns with the Constitutional Court's ruling on Nov. 1 on several issues related to workers’ rights and protections regulated by the controversial 2020 Job Creation Law. The PP is a derivative regulation from the Job Creation Law, popularly known as the Omnibus Law.

"Manpower Minister Yassierli said that the 2025 minimum wage increase will not use the formula from PP 51/2023, in compliance with the Constitutional Court's ruling on the Job Creation Law," the ministry's secretary-general Anwar Sanusi said on Wednesday, as quoted by tempo.co.

However, Anwar did not confirm the plans to draft a ministerial regulation on the formula for calculating minimum wage. He only mentioned that the ministry would announce regulations regarding the wage scheme once a decision has been made.

Meanwhile, the ministry’s Industrial Relations and Employment Social Security (PHIJSK) director general Indah Anggoro Putri, was also unsure when the government would finalize regulations regarding the formula for calculating the 2025 minimum wage.

Indah said discussions on the matter are ongoing between the government, employer associations and labor unions.

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Previously, the ministry had confirmed that the deadline for the minimum wage announcement had been extended to no later than Thursday.

Indah said the 2025 UMP would be announced by the end of December 2024 at the latest.

Despite this uncertainty, Yassierli shared positive news that the government planned to increase the UMP in 2025.

"God willing, the 2025 UMP will bring happiness to workers while ensuring that our friends in the industry have no cause for concern," he said during a discussion with Kompas Gramedia at Menara Kompas in South Jakarta, on Tuesday.

During the discussion, Yassierli addressed reports suggesting that the 2025 UMP would increase by 5 percent compared with 2024. However, he clarified that the exact figure has yet to be confirmed, indicating that the increase could be higher or lower than 5 percent.

This is because the current UMP rates vary across provinces. In some regions, the UMP also exceeds the basic cost of living percentage.

"So, we believe that a single figure is not feasible. We need to provide a range, allowing room for the Provincial Wage Council to decide, as outlined in the Constitutional Court's ruling. It’s not just one figure," he said.

 

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