Wage Policy And Trade Union Struggle for decent wage in Indonesia

Transcription

1 Wage Policy And Trade Union Struggle for decent wage in Indonesia

2 Employment by Sector

3 Wage Policy According To Manpower Act The wage policy that protects workers include: a. Minimum wages; b. Overtime pay; c. Wages that are payable to the worker during his absence from work due to illness; d. Wages that are payable to the worker during his absence from work because of activities outside of his job that he has to carry out; e. Wages payable to the worker during his absence from work because he uses his right to take a rest; f. The form and method of the payment of wages; g. Fines and deductions from wages; h. Things that can be calculated with wages; i. Proportional wage structure and scale; j. Wages for the payment of severance pay; and k. Wages for calculating income tax.

4 The Government shall establish/ set minimum wages based on the need for decent living (kebutuhan hidup layak/khl) by taking into account productivity and economic growth - There are 60 items of Decent living Needs according to Manpower Minister Regulation - The government shall set sectoral wage > minimum wage The minimum wages may consist of: - Provincial or district/ city-based minimum wages; - Sector-based minimum wages within a given province or district/ city;

5 - The minimum wages shall be determined/ fixed by Governors after considering recommendations from Provincial Wage Councils and/or District Heads/ Mayors. - The components of and the implementation of the phases of achieving the needs for decent living shall be specified and determined with a Ministerial Decision

6 Postponing paying minimum wage Entrepreneurs are prohibited from paying wages lower than the minimum wages Entrepreneurs who are unable to pay minimum wages may be allowed to postpone [paying minimum wages]. Procedures for postponing paying minimum wages is regulated with a Ministerial Decision Criminal sanction is applied to employer that don t pay the minimum wage without following mechanism

7 The amount of wage set based on an agreement between the entrepreneur and the worker or trade union must not be lower than the amount of wage set under valid statutory legislation. In case the agreement sets a wage that is lower than the one that has to be set under valid statutory legislation or runs against valid statutory legislation, the agreement shallbe declared null and void by law and the entrepreneur shall be obliged to pay the worker/ labourer a wage according to valid statutory legislation

8 In order to provide recommendations and considerations for the formulation of wage policies to be established by the Government, and to develop a national wage system, the National Wage Council (Dewan Pengupahan Nasional), Provincial Wage Councils, and District/ City Wage Councils shall be established. The councils shall have representatives from the government, employers organizations, trade unions, universities and experts as their members. The members of the National-level Wage Council shall be appointed and dismissed by the President while the members of Provincial Wage Councils and District/ City Wage Councils shall be appointed and dismissed by [the] Governors/ District Heads/ Mayors The Composition of Wage Council Government : Employer: Trade Union = 2 :1:1

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10 Minimum Wage in West Java Province

11 Minimum Wage in Central Java Province

12 Minimum Wage in East Java Province

13 Trade Union Strategy - In the Survey of Decent Living Needs - Strengthen Union position in Wage Council - Pressure on Wage Council - Advocacy on Decent Living Wage Component - Advocacy of Minimum Wage Mayor, Governor - Filing case against Governor ( Postponing of Minimum Wage ) - Filing case against Employer

14 Result - Higher Decent Living needs based on the survey - Law Enforcement -> An employer that paid wager under minimum Wage was sentenced to 1 year in prison - Won cases against the governor -> No postponing of paying minimum wage in West Java and Jakarta province - Minimum wage > Decent living needs

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16 Minimum Wage in Jakarta

17 Government/Employer Responses : 1. increasing minimum wage = increasing unemployment

18 + poverty - Minimum Wage + Unemployment - Purchasing power + Economic Growth

19 2: Export Decline

20 pverty Minimum Wage - competitiveness + Economic Growth

21 Argument 3 : Low Investment

22 Poverty - Minimum Wage - Foreign Investment + Growth

23 Minimum Wage and Unemployment *Jakarta

24 The Change of Minimum Wage Policy -> Government Regulation no 78/ Decent Living Needs reviewed within a period of 5 years - The Review of Decent Living Needs made by the Minister to consider the results of studies undertaken by the National Wages Council. - Studies conducted by the National Wages Council using data and information sourced from authorized institutions in the field of statistics - Results of the review KHL become the basis for calculating the minimum wage further by taking into account productivity and economic growth - Administrative sanctions to employer

25 Formula Wn = Wt + {Wt x (Inflation t + %ΔGDPt)} Sectoral minimum wages are based on negotiations between the employers' association and the unions in the sector concerned The minimum wage applies only to workers with tenure of less than one year. Minimum wage of workers > 1 year bipartite Between unions / labor unions within the company and the Employer

26 Trade Union Response to The New Wage Policy

27 Demonstrations against the wage policy at national and local level File a judicial Review in The Supreme Court Urge the Parliament to form a Special Committee to drop the the new wage policy

28 Maraming Salamat