Workers taking part in a rally in Jakarta on Oct 24 demanding higher wages and the repeal of certain provisions of the Job Creation Law. - AFP
JAKARTA: An Indonesian business group wants the government to stick with the existing method of setting the minimum wage for 2025 after a court last month ordered changes to labour laws that could lead to wage rises, saying investors needed certainty.
The government is expected to announce next year's minimum wage before the end of 2024. The average minimum wage is at 3.1 million rupiah (US$195) per month, government data shows.
Employers Association (Apindo) chairwoman Shinta Kamdani said late on Tuesday that repeated changes in the wage formula would unsettle investors, who she said created jobs.
"The wage formula has been changed over and over and it creates uncertainties for investors... we hope the government could create a conducive business ecosystem and not give preferential treatment," she said in a press conference.
In October, the Constitutional Court ordered changes to the 2020 Job Creation law, including the establishment of sectoral minimum wages.
Labour groups said the ruling also pointed to the potential for basic needs of workers to be also considered in wage decisions, along with economic growth and inflation, and they said the judgement should lead to higher wages in 2025.
Apindo said the risk of a global economic slowdown, as some firms are still recovering from the Covid-19 pandemic, should also be considered in the decision.
Labour groups have called for an increase of up to 10% in the minimum wage for 2025, and say there will be protests if that is not achieved. - Reuters
