A Critical Study on Provincial Minimum Wage and Its Implementation in Industrial Relations: Evidence in Indonesia

Abstract

The implementation of the minimum wage policy known to Indonesia is the provincial minimum wage (PMW) policy and is still a major problem today. This study aims to present an overview of the implementation of the PMW policy in Indonesia, which is based on the necessities of life as regulated in the 1945 Constitution. This document uses data from scientific contributions published in research academic databases. The method used in this research is normative legal research, and the qualitative approach used aims to conduct a document study in order to collect data and analyze data descriptively in order to explore research problems in depth. The findings of this study indicate that in substance the provincial minimum wage functions as an effort to improve a decent life, especially for workers and their families. The implementation of the PMW policy should not harm the survival of the company where this will have an impact on the sustainability of the company's operations. This scientific contribution concludes that the implementation of the PMW policy in industrial relations in Indonesia must be managed professionally to increase the wages and welfare of workers/laborers and increase their involvement in the labor sector, which tends to be very limited. Then, it is necessary to optimize the application of the wage scale structure, and criminal sanctions for entrepreneurs who do not implement the PMW policy in industrial relations in Indonesia. This study is of interest to stakeholders such as: workers, entrepreneurs, academics, practitioners, other observers related to the employment sector.