The Indonesian Textile Association or API objected to the wage article listed in the Government Regulation in Lieu of Law or Perppu Number 2 of 2022 concerning Job Creation. The regulations issued by the government on December 30, 2022 are considered burdensome for entrepreneurs. BPP API Deputy Head of Employment and HR Development, Nurdin Setiawan, said the Perppu does not provide legal clarity on employment, especially wages. This is especially true in article 88 F which states that the government can determine a calculation formula that is different from the previously stipulated minimum wage setting.

"Under certain circumstances the Government may stipulate a formula for calculating a minimum wage that is different from the formula for calculating the minimum wage as referred to in Article 88D paragraph," writes article 88 F in Perppu Ciptaker, quoted on Wednesday (4/1).

According to Nurdin, the uncertainty over the minimum wage regulation does not reflect protection for the labor-intensive sector. Whereas labor costs in the labor-intensive sector are the largest after raw materials.

"So we don't even get legal protection from the government. In fact, it becomes an even bigger burden," he said during a press conference in Jakarta, Tuesday (3/1).

He said the minimum wage also had an impact on the costs that had to be paid for BPJS. The reason is, companies must pay BPJS 10.24% of the minimum wage difference. In addition, the minimum wage regulation will also have an impact on the THR issued by the company.

The burden on the textile industry is getting heavier. He said the Perppu Ciptaker added more burdens to entrepreneurs. In fact, the textile industry is experiencing a very significant decline in orders.

He said the textile industry was experiencing a heavy burden where there was a decline in demand of 30-50% in 2022. This has continued into this year. "So the average order for our members is only 65%. This means that 35% of operational utilities are empty, while we have to pay for labor," Nurdin said at the Apindo Press Conference Regarding Responses to Perppu No.2/2022, Jakarta, Tuesday (3/ 1).

Therefore, in this condition Nurdin hopes that the government will provide a special protection for export-oriented labor-intensive companies. Because directly and indirectly, labor-intensive companies have absorbed a lot of workers, so they can reduce the number of unemployed in Indonesia.

"Now let alone we can glance at new graduates, the employees who are now working together starting in January 2022, we have terminated more than 60 thousand employees. So from us the API is like that," he said.

Member of the Apindo Regulatory and Institutional Relations Committee, Susanto Haryono, is concerned that the new minimum wage formula in the Job Creation Perppu will increase the number of layoffs (PHK).

"Don't get excited about only being paid a minimum wage to boost purchasing power and so on," said Susanto.

Susanto explained, from data from the Investment Coordinating Board (BKPM), the absorption capacity of workers has fallen in the last seven years. So he thinks the policy of increasing the Minimum Wage based on the Perppu formula will increasingly burden the business world.