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Minimum Wage Protests Hit Jakarta
Dofa Fasila, Carla Isati Octama & Bayu Marhaenjati | February 14, 2012

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Hundreds of police and security officials have been deployed to prevent unrest during a protest by labor activists outside City Hall in Jakarta on Tuesday. The demonstration has caused heavy traffic congestion.

The demonstrators, outnumbered by security officials, including riot police, say the city administration’s increase in the monthly minimum wage for workers in the capital is less than the increase of 20 to 30 percent granted to workers in Bekasi.

A spokesman for the demonstrators told the Jakarta Globe that salary increases for workers in the capital ranged from 16 to 20 percent.

Speaking earlier, an official said the sectoral minimum wage would be set at up to 30 percent higher than the standard minimum wage, the highest the capital has ever seen.

A new gubernatorial decree on the sectoral minimum wage was issued on Thursday but will take effect retroactively on Jan. 1, said Deded Sukandar, the head of the Jakarta Manpower and Transmigration Agency.

The highest sectoral wage, set at 30 percent more than the standard minimum wage, will apply to the insurance, banking and telecommunications sectors, whose workers will earn at least Rp 1.98 million ($220) per month. The standard minimum wage (UMP) is Rp 1.52 million.

The lowest sectoral wage, at 6 percent higher than UMP, will apply to workers in the tourism sector.

Deded said the insurance, banking and telecommunications sectors contributed the most to the city’s economy.

“Therefore, it’s only normal to give the highest increase in minimum monthly wages to those two sectors,” he said.

The second-highest sectoral wage, at 13 percent higher than UMP, applies to workers in the metal, electronics and machinery sector and those in the automotive sector. Their new minimum monthly wage will be Rp 1.72 million.

Workers in the chemical, energy and mining sectors will see their minimum wages at Rp 1.69 million, 11 percent higher than the standard minimum wage.

The minimum wage in the food and drink sector will be Rp 1.68 million, 10 percent higher than UMP. It will be 8 percent higher to Rp 1.65 million in the pharmaceutical and health sector; and 7 percent at Rp 1.63 million in the textile, garment and leather sector. Workers in the tourism sector will receive a minimum monthly wage of Rp 1.62 million.

In the construction and public works sector, the minimum wage is set for a daily rate of between Rp 93,510 and Rp 143,221, depending on the workers’ skills.

Deded said those wages only applied to workers with less than one year of service; for those with more working experience, the wage should be negotiated with their companies’ management.

In 2010, sectoral wages were set at 5 percent to 15 percent higher than UMP.

Still, the Jakarta Labor Forum said the approved wage increases were unrealistic, pointing to the neighboring district of Bekasi, where monthly wages were 25 percent to 30 percent higher than UMP.

Forum spokesman Muhammad Rusdi called on the governor to revoke the new decree and “set a new sectoral minimum monthly wage increase that is at least the same as that in Bekasi.”

He said sectoral growth averaged 30 percent and wages should also be raised that amount.

“If our demand is not met, we’ll hold massive protests on Tuesday,” he said.

The wage hike in Bekasi came after thousands of workers from about 300 companies blocked the Jakarta-Cikampek toll road for several hours on Jan. 27. They were protesting a court ruling that favored the lawsuit filed by the Indonesian Employers Association (Apindo) against the wage increase.

Apindo’s secretary general, Franky Sibarani, said on Monday that he respected the Jakarta administration’s decision.

“Sectoral minimum wages are not decided unilaterally,” he said. “If the process involved all sectoral associations, labor unions and the local government, then it must be accepted by all.”