Saturday, November 25, 2006

Wage increase to give 'minimum benefit'

City News - November 23, 2006
The Jakarta Post, Jakarta

Some factory workers in the city say raising the minimum wage by 9.5 percent does not benefit them, because small increases are eaten up by increases in the cost of living.

"It won't make much difference because of the soaring prices of basic goods," said Dewi, 20, a worker at an East Jakarta garment factory.

The rise will not really affect our lives, said another female worker at the same factory.

The city administration's decision to raise the monthly minimum wage to Rp 900,500 (about US$98), from Rp 819,100 previously, by January, has rekindled old debates.

Advocates say a raise is long overdue. But critics say the move would not help the economy and employers would see higher labor costs as they stepped up average wages.

They also say employers might consider full-time workers "too expensive to hire", creating a permanent army of part-timers.

Lidia, 20, a part-time worker at the same factory said she earned about Rp 25,000 for eight hours' work or about Rp 500,000 a month, which is significantly lower than the official minimum wage.

A government official says the ruling does not differentiate between full and part-time workers.

"It applies to all workers, including part-time workers and contract workers, if they are working for at least seven hours a day, six days a week," Muzni Tambusai, director general of the Manpower and Transmigration Ministry, told The Jakarta Post recently.

A staffer at the factory where Lidia works, who asked not to be named, said: "We do pay some workers the minimum wage set by the city administration, but they are full-time contract workers. Every company does that".

Lidia said she earned less when she worked at a another factory nearby, but quit the job in less than a month.

"I was paid only Rp 25,000 a week. We had to work until late and didn't get overtime pay."

The factory, she said, did not give workers their salary slips.

The wage increase will not likely make much difference to permanent employees either.

"I get about Rp 1 million a month, inclusive of transportation and meal allowances," said Yanto, 40, who has been working in a food factory for 15 years.

When asked about the wage increase, he said, his wage was raised every year in accordance with minimum wage increases and his performance appraisal.

Yanto said workers in the factory had set up a trade union to protect their rights.

"But there is something wrong with the salary scale because old employees don't receive much more than new ones," Yanto said. "The increase will not significantly affect me."

The father of two said his wage was inadequate to support his family, as he paid Rp 210,000 a month in rent.

"I am not able to save anything," he said. (04/06)


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