Trade unions led 5,000 workers in a mass rally in Jakarta on 16 January denouncing the government’s decision to exempt over 900 companies from paying the increased minimum wages as agreed in November 2012.
The 16 January 2013 rally marched from in front of Jakarta`s Metropolitan Police Office at 9am to the Ministry of Energy and Natural Resources’ and then to the Ministry of Manpower and Transmigration (Ministry of Labour). The police and military deployed 9,000 officers to oversee the demonstration.
The second demand of the rally was for government to block the proposed increase to electricity prices that will drastically reduce workers’ purchasing power.
A month after Indonesian unions mobilized 3 million workers in massive rallies on 3 October 2012 the Jakarta minimum wage was set to be raised from US$157 to US$230 for the year 2013.
Around 986 companies, mostly in the shoes, garment and textile industries have since sent letters to the Labour Ministry asking to be exempt from paying the new minimum wage until next year at least, and 46 labour-intensive firms already have approval. Many of those 986 companies are continuing to use the military and yellow unions to intimidate workers from organizing into democratic unions.
The powerful Federation of Indonesian Metal Workers' Union FSPMI led by president Said Iqbal mobilized thousands of metalworkers. Iqbal is also president of trade union confederation KSPI which also rallied members to the march. The new Indonesian workers' council MPBI, that united the country’s three major trade union confederations (KSPI, KSBSI, and KSPSI), also participated.
Said Iqbal argues that the Ministry of Labour only has the right to grant exemptions to companies under one of two sets of circumstances. Either the company has been shown in an audit to have made a loss in each of the past two years, or that an agreement has been reached with workers to delay the salary increase.