Indonesia’s $50 increase in minimum wage of maids takes employment agencies by surprise

A new round of increase in the minimum wage of Indonesian domestic workers has taken employment agencies here by surprise, but a counsellor from the Indonesian embassy says it had to be done to “protect the income of the Indonesian maids” who now make up about 70 per cent of Singapore’s foreign domestic workers at about 125,000.

From $500, newly hired maids and those up for contract renewal starting January 2016 will have to be paid at least $550 per month, though the Ministry of Manpower told The Straits Times that it has yet to receive an official notice from the Indonesian government.

Speaking to ST, an agent who asked to remain anonymous acknowledged that there was a meeting with an Indonesian government official where “we discussed many other issues like regulation and loans, but salary was not one of them.” 

The minimum wage had been increased from $400 to $450 in September 2014. The Indonesian Embassy made the recent announcement in a letter to maid agencies. Singapore, unlike Taiwan and Hong Kong, doesn’t have a minimum wage, it said.

Transient Workers Count Too, a non-government organisation looking out for migrant workers, says there may be a problem of seeing that this higher rate is implemented.

“It is not easy for one country to insist on something that falls under another country’s jurisdiction; a lot really depends on most employers recognising that a pay rise such as this is far from unreasonable,” says John Gee, head of TWC2’s research team. “We need to pay better salaries as a matter of fairness and in order to keep on attracting workers to come to Singapore.”

The Singapore government can also play a part, it says, by lowering the levy rate paid by employers “who themselves may find their family finances stretched”, as it had done so before.

Photo: Jerry Wong via Flickr

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