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THE Indonesia’s Government and the House of Representatives (DPR) should pay attention to all sides by taking into account the aspirations as well as public participation including industry players when establishing various clauses in the Draft Ombudsman Work Copyright Law.
According to the Deputy Chairperson of the Indonesian Hotel and Restaurant Association (PHRI) Maulana Yusran in his press release emphasized that one that was considered to be burdensome was the provisions regarding the company’s obligation to provide bonuses of up to 5 times wages for those who had worked for at least 12 years.
“PHRI assesses that this obligation will provide a very large operational burden for the company. In fact, the current business situation and future will still be difficult. Where do the worker bonuses valued as sweeteners go? In the present condition, business is difficult to compete and grow in Indonesia because of the existence of minimum wage regulations and so on,” Maulana said.
He added, in the Employment Copyright Ombudsman, provisions regarding bonuses were found in the employment cluster. The DPR and the Government have indeed agreed to delay the discussion of this cluster. Therefore, PHRI recommends that the government and the Parliament make various adjustments.
“In the hotel industry, for example, the wage component of workers can reach 25% of the company’s total burden. Therefore, bonus obligations of up to 5 times wages will be very burdensome to companies, especially in the tourism sector. Likewise, other sectors that are labor intensive with high operational burden of workers,” he noted.
He explained, in the tourism industry wages or salaries are not the main benchmarks in respect for workers. Because, they have other parameters such as service incentives.
“Hotels that are still operating are only paid wages, while the service can be double the salary. It can be seen that this sector does not prioritize salary, because service money is the benchmark for service. It means that the high occupancy of the service money is also high,” he added.
For some business players, performance-based bonuses are also carried out to maintain service performance. PHRI also asked the government and the DPR not only to adopt populist policies, but rather to direct them to create competitiveness and investment. High and excessive wages/compensation increases are considered to be futile because they can directly influence investment. Because, job creation will still not happen.
According to Maulana, if employers are still burdened with employee bonus obligations, the potential for companies to recruit new workers will be reduced. Labor costs also become uncompetitive. As a result, this will reduce the interest of investors to invest in Indonesia.
“At this rate, competitiveness is reduced, and many companies are closing down. So the termination of employment can be even greater,” he noticed.
In fact, currently the unemployment rate in Indonesia is quite large. Data from the Central Statistics Agency noted that the level of open unemployment as of February 2020 reached 6.88 million people or 4.99% of the total workforce (aged 15-64 years) of 137.91 million people.
This figure is certain to increase as the outbreak of the COVID-19 outbreak. The National Development Planning Agency even predicts that there will be an additional 4.22 million unemployed people after being laid off or laid off due to layoffs due to workplace affected by the COVID-19 outbreak.
Maulana said PHRI hoped the government could find a middle ground in this policy by prioritizing solutions for business growth, maximum employment, and health and social security for workers, especially for labor-intensive industries.
Businesses that survive maintaining the numbers of their employees need support from the Government to go through this difficult time instead of placing an additional burden.
Previously, President Joko Widodo said that the postponement of the deliberation of the Cipta Karya Bill on Labor Clusters was done in response to the demands of workers who objected to a number of articles. This was later positively responded by a number of parties especially now that Indonesia is still facing a crisis due to the spread of COVID-19. [kontan.co.id/photo special]
