Reconstructing the Regional Minimum Wage Framework in Indonesia: An Empirical and Maqashid al-Shari’a Perspective on Islamic Financial Institutions

This study aims to reconstruct the framework for determining the minimum wage in Indonesia by evaluating contemporary positive labor law through the lens of maqashid al-shariah philosophy. Specifically, it examines the systemic gaps in state regulations regarding worker dependants and analyzes the empirical mechanisms employed by Sharia Financial Institutions (SFIs) to achieve ethical wage fulfillment. Adopting a qualitative socio-legal approach, this research combines normative legal analysis of statutory provisions (such as PP No. 51 of 2023 and the Manpower Act) with empirical field data evaluated under the conceptual framework of al-daruriyaat al-khamsah (the five essential human needs) and al-'adalah (universal justice). Field data was gathered through semi-structured interviews and observations with executives across selected SFIs, including Bank Syariah Indonesia (BSI), Bank Muamalat, and Sharia Cooperatives. The findings demonstrate that while positive legal frameworks restrict nominal wage calculations to macroeconomic metrics (inflation and economic growth), they fail to accommodate the domestic survival needs of a worker’s family. Conversely, under the dharuriyah level of maqashid, an ethical wage must secure lineage preservation (hifz al-nasab) and human capital health (hifz al-aql). Empirically, SFIs bridge this structural paradox by complying with state-mandated minimum wages while simultaneously mobilizing extensive non-wage components—such as profit-sharing (syirkah), performance bonuses, and family healthcare incentives—to fulfill maqashid expectations.