Employers Association proposes 20 pct increase of minimum wage in 2014

"That`s only a benchmark if inflation plus. If it has not happened yet, this should be discussed to get tripartite agreement," said Apindo chairman Sofyan Wanandi.
Jakarta (ANTARA News) - The Indonesian Employers Association (Apindo) has proposed a 20 percent increase of provincial minimum wage or UMP in 2014 in effort to balance the inflation that is expected to continue to rise.

"That`s only a benchmark if inflation plus. If it has not happened yet, this should be discussed to get tripartite agreement," said Apindo chairman Sofyan Wanandi here on Friday.

Sofyan said proposal of the 20 percent increase of minimum wage was aimed to take back investment of the labor-intensive enterprises which have been more interested in investing abroad so far due to their objections by the amount of domestic UMP.

"We want that the labor-intensive companies continue entering the country and never go out," he said.

According to him, proposal of the 20 percent wage increase is also to anticipate rising inflation due to 40 percent wage hike in 2013, while the labor current demand is 50 percent.

Sofyan said that proposal of such wage increase will still be discussed in tripartite talks that will involve the government, employers and workers.

"The calculations must be discussed in the tripartite talks, if there is no agreement, the government will take its own decision," he said.

Sofyan also expressed hope that the results of the tripartite discussion regarding the 2014 labor minimum wage will come out this year.

However, he would rather have inflation plus than the 20 percent wage increase because each company has different condition.

Meanwhile, Industry Minister MS Hidayat predicted that the 2014 inflation plus would be three to four percent, if inflation in 2013 is seven percent, it would reach 10 percent in 2014.

"This becomes national reference which can be debated at the Wage council forum," the minister added.(*)

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