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Ratification of the Perppu on Job Creation Benefits Workers


By : Bagas Adrian Nathaniel )* 

The government has ratified the Job Creation Perppu in March 2023. This ratification is welcomed by workers because it will benefit them. The minimum wage will be determined by the governor so that the nominal is sufficient for daily life, and it always goes up every year. The workers support the ratification of this Perppu because they always side with them.

The government has carefully planned the Job Creation Perppu for progress in the field of investment and employment. This Perppu was installed as a substitute for the Job Creation Law. The Job Creation Perppu is guaranteed not to harm workers because workers’ rights still exist and the public is asked not to believe hoaxes about this Perppu circulating on social media.

The government has officially approved Government Regulation in Lieu of Law (Perppu) Number 2 of 2022 concerning Job Creation to become a law. The inauguration took place during the 19th Plenary Session at the Parliament complex, Tuesday 21 March 2023.

The Director General for Development of Industrial Relations and Labor Social Security at the Ministry of Manpower, Indah Anggoro Putri, stated that the wage regulations to be revised are related to the minimum wage calculation formula where the variables are economic growth and inflation, accompanied by a certain index which will be linked to the rate of increase in the minimum wage according to function as a social safety net. The revision occurred after the Job Creation Perppu was passed.

In a sense, the Job Creation Perppu is in favor of workers because there is a revision of the previous rule (Job Creation Law). Where the provincial minimum wage setting can be changed based on economic growth and inflation. Given that inflation is a natural thing to happen and the normal increase is 8% per year. If there is inflation, the UMP (Provincial Minimum Wage) will also be adjusted.

According to article 88C, the provincial minimum wage must be determined by the governor. Governors can also set district and city minimum wages. “The minimum wage referred to in paragraph (1) and paragraph (2) is determined based on economic and employment conditions,” reads article 88C paragraph 3.

The Job Creation Perppu benefits workers because the minimum wage is not the same and each province is different, because the price of basic necessities in each region is different. For example, in Surabaya and Temanggung the prices for basic foodstuffs are different, therefore the UMP is also different. 

Workers benefit from the UMP because the amount is determined by the governor, who understands the price of rice and other basic needs in his area. They don’t need to worry because the determination of the UMP is in accordance with the rules. There is no such thing as a low UMP because every year it actually increases.

Certain conditions include regional economic growth or inflation in the district/city concerned. Meanwhile, the district/city minimum wage must be higher than the provincial minimum wage. Economic and employment conditions use data sourced from the competent authority in the field of statistics.

Further provisions regarding the procedure for setting the minimum wage as referred to in paragraph (3) and certain conditions as referred to in paragraph (4) are regulated in a Government Regulation, reads Article 88C paragraph 7 of the Job Creation Perppu.

The provincial minimum wage is calculated using the formula for calculating the minimum wage by taking into account the variables of economic growth, inflation and certain indices. “Further provisions regarding the formula for calculating the minimum wage are regulated in a Government Regulation, reads Article 88D paragraph 3 of the Job Creation Perppu.

The workers also don’t need to worry because those whose salary is in accordance with the UMP are only new employees. The UMP salary provisions apply to workers with a working period of less than 1 year at the company concerned. “Entrepreneurs are prohibited from paying a wage lower than the minimum wage, writes Article 88E paragraph 2 of the Job Creation Perppu.

It is clear that the Job Creation Perppu benefits workers because they get a decent salary and a minimum UMP. The nominal UMP has also been estimated and can be used for everyday life, and not too little. The UMP also rises every year and benefits workers because they don’t have to think about the effects of inflation. 

Meanwhile, the Coordinating Minister for Politics, Law and Security Mahfud MD stated that the criticism occurred because workers had not fully studied the benefits of ratifying the Job Creation Perppu. There are also those who read the headlines (about this Perppu) without reading the contents. However, he invited the public to discuss and socialize the Job Creation Perppu. 

In a sense, if someone accuses that the ratification of the Job Creation Perppu is detrimental to society, then they are gravely mistaken. The reason is because this Perppu is designed to benefit Indonesian citizens, both workers and employers. Workers are asked not to just read news about the ratification of the Job Creation Perppu from incompetent media or even just read the title and then draw their own conclusions. 

The ratification of the Job Creation Perppu benefits workers because they will get a minimum salary of the UMP and the nominal is very decent. The UMP will continue to rise every year and workers can enjoy their salaries without fear of being affected by inflation. 

)* The author is a Kawiwara Pustaka Contributor

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