Implications of the Enactment of Ministry of Manpower Regulation Number 16 of 2024 on the Determination of the 2025 Minimum Wage
Regulation of the Minister of Manpower Number 16 of 2024 on the Determination of the 2025 Minimum Wage establishes the minimum wage as a safety net to prevent wages falling below a fair standard for workers. This regulation sets forth a mechanism for calculating the minimum wage, factoring in inflation, economic growth, and workers' purchasing power. Regional governments are mandated to determine provincial or regency/city minimum wages (UMP/UMK) in accordance with the formula stipulated in this regulation. The primary objective is to strike a balance between safeguarding workers' welfare and ensuring business sustainability. The regulation also emphasizes transparency and accountability in wage determination, aiming to promote equitable economic growth and industrial harmony. Find out more our insights about this topic in our Legal Brief publication.
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