Nike’s Minimum Wage Troubles

From The Financial Times:

The battle over factory pay in Indonesia is intensifying, with vocal local trade unions joining hands with a US non-governmental organisation to pressure Nike suppliers into paying minimum wages.

A yawning gap is opening up between employers, who argue that hefty minimum wage increases are destroying their profitability, and trade unions, who argue that wages must rise further and employment conditions be improved.

The Jakarta city government hiked the minimum wage by 44 per cent to Rp2.2m ($228) on January 1 and other provinces have followed suit with hefty increases.

At a joint press conference in Jakarta on Monday, Indonesian trade unionists and Education for Justice, an American Catholic NGO, criticised Nike’s suppliers in Indonesia for seeking exemptions to the minimum wage, which are allowed for companies that cannot afford to raise pay.

 

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