Apindo Prefers UMP Determination By Company And Employee Agreements

Apindo Prefers UMP Determination By Company And Employee Agreements

Wednesday, 27 Nov 2024

The Indonesian Employers Association (Apindo) is urging the government to establish minimum wage regulations through a bipartite agreement, which involves consensus between workers and companies. This statement was made by Bob Azam, the Chairman of Apindo's Employment Sector, in response to the unclear regulations surrounding the minimum wage for 2025.

"We genuinely advocate for a bipartite wage system because the companies and their labor unions are the ones most aware of the company's progress and challenges," Bob stated during a media discussion on Tuesday, November 26, 2024. Additionally, Apindo had previously signed a memorandum of understanding (MoU) with the former Minister of Manpower, Ida Fauziyah.

In this MoU, both the government and Apindo agreed to promote a structured wage scale to improve the wage system in the future. However, following a ruling by the Constitutional Court at the end of October 2024, the implementation of this agreement has become unfeasible.

Business operators have expressed their disappointment with the government regarding the Constitutional Court's decision to annul the wage system. This discontent has been communicated by Apindo to the current Minister of Manpower, Yassierli. "We met with the Minister and conveyed our disappointment regarding the minimum wage process," he revealed.

According to Bob, the issue of minimum wage has persisted for over 13 years, and Indonesia has yet to resolve it. Consequently, the country frequently misses various opportunities that could propel it towards becoming a developed nation. For instance, in the early 1990s, there was interest from electronics companies to invest in Indonesia.

The plan was ultimately canceled due to a strike. Consequently, investors in this sector have opted to invest in Malaysia rather than Indonesia. Additionally, the frequently changing wage regulations in the near future pose further challenges.

Previously, Minister of Manpower Yassierli confirmed that the government would soon issue a Ministerial Regulation concerning the Provincial Minimum Wage (UMP) for 2025.

He conveyed this information to reporters following a meeting with President Prabowo Subianto to discuss the determination of the Provincial Minimum Wage at the Presidential Palace in Jakarta on Monday, November 25, 2024. "I aim to have this finalized by the end of this month. At the latest, it should be out by the beginning of next month; hopefully, the ministerial regulation will be released by the end of this month," he stated. (ridwan@insightinnews.com)

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