UMP and UMR – When you apply for a job, one of the things to consider is the salary you will receive, right? As an applicant, a question may have crossed your mind: Am I getting the minimum wage?
Of course, those who have already entered the world of work, you're not unfamiliar, right, with the terms Provincial Minimum Wage (UMP) and Regional Minimum Wage (UMR). UMP and UMR are terms used for the minimum wage that you will receive as a worker in an area in Indonesia. So, what Thedifference between UMP and UMR?
Now, for those still confused about the difference between UMP and UMR, let's see the explanation in this article!
Also Read: Do You Get Paid During On-the-Job Training? Find Out The Rights and Responsibilities!
Definition of UMR and UMP
You know what, Whizmates? Based on the Ministerial Regulation of the Ministry of Manpower of the Republic of Indonesia No. 7 of 2013 concerning Minimum Wage, UMR or Regional Minimum Wage is no longer valid and has been replaced with UMP and UMK !
The Provincial Minimum Wage, abbreviated as UMP, is the wage given to workers per the policies set by the Governor. The UMP will also apply in every district/city covered in that province.
According to ekrut.com, the nominal of the UMP will be determined by the standards of each economic condition in a district/city. This is due to different economic conditions in each city. This policy has also been regulated in the Regulation of the Minister of Manpower Number 3 Article 1 concerning Minimum Wage.
Usually, the UMP will be determined by the Governor every November 21 and implemented starting January 1 of the following year. What about you, Whizmates? Do you understand now?
The Definition of UMK
UMK is the District/City Minimum Wage. This UMK standard applies to workers in the district/city area. The UMK is determined in the same way as the UMP, which is determined by the Governor, but based on a proposal from the regent or mayor.
Usually, this UMK is determined by the Governor every November 30, and is implemented starting January 1 the following year, Whizmates!
The Difference between UMP and UMR
After discussing the definition of UMR, UMP, and UMK, we need to understand the difference between UMP, UMR, and UMK. The following are essential points that can distinguish between the three.
1. Regulatory Authority
Firstly, the difference between the UMP, UMR, and UMK is the regulator of authority. As we already know, the UMP is set directly by the Governor by looking at the economic conditions in each district/city. At the same time, the UMK is determined by the regent or mayor, which is then submitted as a proposal to the Governor.
2. Underlying Factors
The underlying factor determining how much or nominal the UMP and UMK are also one of the differences we can know. If the UMP is determined based on the economic conditions of a province, then the UMK is based on the economic growth of a district/city, inflation, and others.
3. Coverage Area
Another difference between the UMP, UMR, and UMK is the coverage area that affects the distribution of wages in each region. The UMP is set for all districts/cities within the province, while the UMK is set to set the lowest wage limit in each district/city.
4. Setting Time
UMP is set every November 21, while UMK is set every November 30, and both will be implemented starting January 1 in the following year.
Benefits of Setting the Minimum Wage
An interesting fact that Whizmates should know is that this minimum wage regulation in Indonesia has existed since the 1970s! However, it was only enacted in the 1990s due to pressure from other countries about sweatshops, that is, utilizing workers with low wages, many working hours, and workplaces that are not proper.
So, since then, the minimum wage has been implemented in areas in Indonesia. Some of the benefits that we can see with the existence of the minimum wage, namely as follow.
1. For Workers
- Improving the quality of life of workers and improving the welfare of their families
- Increasing the sense of justice for workers
- Reducing poverty
- Allowing workers to meet daily needs by the purchasing power of consumers in a region
- Increasing workers' productivity
2. For Companies
- Can make a long-term labor wage cost budget with certainty
- Attracting other investors because of the company's financial certainty
- Enabling to project its financial strength every year
Also Read: The Sources of Government Revenue You Should Know
This is the explanation of the differences between UMP, UMR, and UMK that you should understand, Whizmates! We hope this article will be helpful and inspire Whizmates to develop a better career in the future!
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