The West Java Provincial Government has set the 2024 Provincial Minimum Wage (UMP) at Rp2,057,495.
This figure is a 3.57% increase, or Rp70,825 more, than the 2023 UMP.
Acting Governor of West Java, Bey Machmudin, stated that the UMP calculation adheres to Government Regulation (PP) Number 51 of 2023 concerning Wages.
He also mentioned incorporating aspirations from worker associations and unions, and accepting recommendations from the local Wage Council during the UMP determination process.
Previously, labor unions had requested a 15% UMP increase. However, Bey Machmudin stated that the final decision must be based on regulations and represent various parties, including employers.
"We believe that PP Number 51 accommodates all interests," said Bey Machmudin in his press release on Tuesday (21/11/2023).
The 2024 UMP will guide the determination of the District/City Minimum Wage (UMK), which will be announced by November 30, 2023 at the latest.
"Certainly, (UMK) will increase compared to last year," said Bey Machmudin.
PP Number 51 of 2023 states that the minimum wage applies to workers with less than one year of service.
For workers with more than one year of service, wages are based on the company's established wage structure and scale.
Initially, based on the Manpower Law Number 13 of 2003, employers were prohibited from paying employees less than the minimum wage.
However, this provision was amended through the Job Creation Perppu Number 2 of 2022 (Chapter IV Employment Article 90B) which reads: "The minimum wage provisions as referred to in Article 88C paragraph (1) and paragraph (2) are exempted for micro and small businesses".
Therefore, business entities categorized as "micro" and "small" are no longer obligated to follow the minimum wage regulations.
Based on PP Number 7 of 2021, the criteria for "micro businesses" are those with a maximum capital of Rp1 billion (excluding land and buildings), or annual sales of a maximum of Rp2 billion.
The criteria for "small businesses" are those with capital >Rp1 billion to Rp5 billion (excluding land and buildings), or annual sales >Rp2 billion to Rp15 billion.