SALARY

Indonesian Law Regulation No. 13 of 2003
Concerning Manpower

SALARY

Article 90

1. Entrepreneurs shall be prohibited from paying a wage lower than the minimum wage
    as meant in Article 98.

2. Entrepreneurs unable to pay the minimum wage as meant in Article 89 can apply for
    postponement.

3. Procedures for the postponement as meant in paragraph (2) shall be regulated by a
    decree of the minister.

Article 98 stated that:

1. National, provincial and regency/city wage councils shall be established to provide
    recommendations, considerations and formulate wage policies to be stipulated by the
    government as well as to develop the national wage system.

2. Members of the wage councils as meant in paragraph (1) shall consist of
    representatives of the governments, entrepreneur organizations, labor/worker unions,
    universities and experts.

3. The President shall appoint and relieve members of the national wage council, while
    members of provincial/regency/city wage councils shall be appointed and dismissed
    by governors/mayors/regents.

4. Provisions on procedures for the establishment, composition of membership,
    procedures for he appointment and relief of members as well as tasks and working
    arrangements of the wage councils as meant in paragraphs (1) and (2) shall be
    regulated by a presidential decree.

Article 89 stated that :

1.The minimum wage as meant in Article 88 paragraph (3) letter a shall consist of:

a. The minimum wage by provinces or regencies/cities;
b. The minimum wage by sectors in provinces or regencies/cities

2. The minimum wage as meant in paragraph (1) shall be directed to accomplishment of
     the adequate life need.

3. The minimum wage as meant in paragraph (1) shall be stipulated by governors by
    observing recommendations of the provincial wage councils and/or regents/mayors.

4. Components as well as the implementation of phases of accomplishment of the
    adequate life need as meant in paragraph (2) shall be stipulated by a decree of the
    minister.
Article 88 stated that :

1. Every workers/labor shall entitle to obtain income fulfilling humanely adequate
    sustenance.

2. In order to realize the income fulfilling humanely adequate sustenance as meant in
    paragraph (1), the government shall stipulates a wage policy protecting workers/labor.

3. The wage policy protecting workers/labor as meant in paragraph (2) shall include:

a. Minimum wage;
b. Overtime wage;
c. Wage due to absence because of certain reason;
d. Wage due to execution of other activities outside their jobs;
e. Wage due to exercise of their rights to working rest;
f. Model and method of payment of wage;
g. Fine and discount of wage;
h. Matters included into wage
i. Structure and scale of proportional wage;
j. Wage for paying severance pay; and
k. Wage for calculation of income tax

4. The government shall stipulate the minimum wage as meant in paragraph (3) letter a
    on the basis of the adequate life needed by observing economic productivity and
    growth.

xheers,
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