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Retailers protest high minimum wage, threaten to switch to machines
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The inside of convenience store Indomaret. (Shutterstock.com/Fatrin Budiman)
R
etailers are strongly protesting Jakarta Governor Anies Baswedan’s decision to increase the minimum wage for retail workers to Rp 4.29 million (US$306.28) per month, higher than the city's minimum wage of Rp 3.94 million.
The decision was stipulated in Gubernatorial Regulation No. 6/2019 on the provincial sectoral minimum wage. Article 2 of the regulation prohibits employers from paying their workers a salary that is lower than the regulated minimum wage.
Association of Indonesian Retailers (Aprindo) deputy chairman Tatum Rahanta called on the Jakarta administration to be more careful in making decisions on wages.
“Retail is a labor-intensive business that employs large numbers of unskilled workers. Therefore, we want to meet [with the governor] to explain everything,” Tatum said in Jakarta on Wednesday as quoted by kontan.co.id.
If the city insisted on defending its decision, he added, retailers might need to lay off workers and replace them with automated machines to make business more cost-efficient.
“We are considering modernizing our operations by replacing the workers with automated machines. We will reduce our number of workers and replace them with technology. It will be more efficient,” he added.
He explained that, for convenience stores, retailers had to allocate 30 to 40 percent of their revenue for wages, while for supermarkets and department stores, the percentage was often higher. (bbn)
