MK in favor of labors in wages dispute

JAKARTA. Constitutional Court (MK) ruled in favor of some labors in their appeal against provision on the suspension of minimum wage under the explanatory of  article 90 paragraph 2 Law No 13/2003 on Manpower.

According to MK, the phrase “is not subject to settle the minimum wage is not obliged to make up the difference between the wages it actually paid and the applicable minimum wages during the period of time of the postponement” in the explanatory contradicts to Indonesian constitution.

Constitutional Judge Manahan Sitompul said that the explanatory of article 90 paragraph 2 of the law is inconsistent with the article 90 paragraph 2 of the law.

Article 90 paragraph 2 of the Law No 13/2003 on Manpower stipulates that entrepreneurs who are unable to pay minimum wages may be allowed to postpone the minimum wages payment.

However, the explanatory of the article stipulates that the postponement of the payment of minimum wages by an enterprise that is financially not able to pay minimum wages is intended to temporarily release the enterprise from having to pay minimum wages for a certain period of time.

If the postponement comes to an end, the enterprise is under an obligation to pay minimum wages that are applicable at the time but is not obliged to make up the difference between the wages it actually paid and the applicable minimum wages during the period of time of the postponement.

According to Constitutional Court, the inconsistency may lead into different interpretation on the postponement of wages payment.

As an information, Federation of Independent Labor Union (GSBM) filed judicial review on article 90 paragraph 2 of the Law No13/2003 on Manpower. According to GSBM, the provision has created uncertainty among labors.

Lawyer of GSBM Pelikson Silitonga said, the Constitutional Court decision is in favor of labors. The decision will be an instrument to force entrepreneurs to fulfill their obligations to workers. Previously, the entrepreneurs never covered up the difference between wages they actually paid and the applicable minimum wages during the period of time of the postponement. Under the Constitutional Court’s decision, the wages postponement and the difference will become entrepreneurs’ debt.

Meanwhile, Vice Chairman of Jakarta Regional Office of Indonesian Chamber of Commerce and Industry Sarman Simanjorang said that the entrepreneurs still need to review Constitutional Court’s decision. (Translator: Muhammad Farid)