Minimum wage should favor both people and country: ILO chief

"So you have got to find mechanisms of fixing wages which not only meet workers' needs but also take into account the realities," Ryder remarked.
Nusa Dua, Bali (ANTARA News) - The fixing of a minimum wage needs to ensure that people can meet their basic needs, while taking a countrys productive reality into account, Director General of the International Labour Organization Guy Ryder said.

A minimum wage mechanism need to have a basic level which is appropriate, he said.

"(It is important that) minimum wages are fixed at a level where people can meet their basic needs. There is no use in having a minimum wage which cannot allow you to eat and take care of your family," Ryder said to ANTARA today in the middle of the ILO 16th Asia and the Pacific Regional Meeting in Bali Nusa Dua Convention Center.

This level needs to also consider the reality of the countrys economic condition, and it cannot be set too high if the economy does not sustain it, he continued.

"So you have got to find mechanisms of fixing wages which not only meet workers' needs but also take into account the realities," Ryder remarked.

The debate around the fixing of minimum wage is a difficult one that happens in a number of countries, but it is also really effective as it puts a floor in the labor market, Ryder believed.

"In the meantime, we have to develop collective bargaining, it is important," he added.

The director general also lauded Vice President (VP) Jusuf Kallas proposal to implement the regional (Asia Pacific) minimum wage standard.

"We had a very interesting proposal from the VP in the conference yesterday, he said lets have a regional minimum wage arrangement, because our problem is if we set our minimum wage to certain level and another country comes in another, this is not fair. I think this regional approach is an interesting idea," he reiterated.

During the World Economic Forum in June, Kalla has proposed the implementation of an ASEAN minimum wage for workers in the ASEAN member countries to ensure equality in the region.

"It is very important to prevent unhealthy competition in ASEAN," he said.

He urged ASEAN countries not to force workers to compete on lower wages but work together to create a minimum standard wage to induce a healthy competition.

"So, the question is not how to make hiring of workers cheaper but how to improve productivity and increase the purchasing power of the people so that economy thrives," he explained.(*)

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