INFID

International NGO Forum on Indonesian Development

Prisoners of Progress

A review of the current Indonesian labour situation (March 1995)

Indonesia has achieved important progress in the past 25 years. Poverty has decreased significantly, access to primary education and health care has improved and life- expectancy has gone- up. The World Bank expests average annual per capita income to reach the level of US$ 1000 by the year 2000. However, this leaves much to be desired in Indonesia when it comes to the distribution of income, equal access to economic opportunities, environmental sustainability and respect for human rights.

In a context of a strong drive to promote export oriented industries and to increase the exposure of Indonesia's human and natural resource base to global market forces, the reality of many Indonesian workers is one of low wages, poor labour conditions and a lack of justice and freedom of organisation. Under these circumstances, Non Governmental Organisations (NGOs) in Indonesia play an important role in helping to create the conditions for the protection of workers' rights, in particular for the weakest groups, such as women, children and overseas workers. Indonesian and international NGOs, meeting under the auspices of the International NGO Forum on Indonesian Development (INFID) have repeatedly called upon the Indonesian government to change its development policy priorities. Its desire to minimise labour costs in order to attract foreign investment represents a continuing violation of both national and international workers' rights. After a renewed assessment of the labour situation in Indonesia early 1995, the following recommendations were particularly listed or reaffirmed:

I. The Right to Organise and Bargain Collectively

a. Freedom of association continues to be restricted in Indonesia. In recent legislation, the Government recognises the right of workers to negotiate collestive agreements at the factory level, but at the same time, it explicitly states that SPSI (All Indonesia Workers Union) is the only trade union, and that if enterprise level unions want to form federations, they must do so through SPSI. The criteria set by the Government for the registration of unions in terms of the number of members make it virtually impossible for alternative trade unions at the sectoral level and for trade union centres to be established. The right to organise and the right to bargain collectively, as elaborated in ILO Conventions No.87 and No.98, must be fully respected and implemented in law and practice, both in the private and the public sector.

b. The restructuring of SPSI into sectoral unions may create better opportunities for real trade union work including collective bargaining, but implementation of this reform must be carefully monitored. Implementation should not preclude the formation of other unions.

c. Labour legislation must be simplified and made transparent, and the law must be consistently and effectively enforced. This includes the harmonisation and updating of sanctions on the violation of labour laws and regulations. A violation of the guidelines for minimum wages, for example, is still fined by Rupiah 100.000 (about US$ 50), the amount which was established in 1969. The legal minimum wage must be increased up to the subsistence level.

II. The Right to Strike

Workers participating in strikes often are unfairly dismissed, for example, by being forced by the security forces to sign their own letters of resignation. In addition, existing legislation strongly discourages strikes by stipulating that workers who are absent from work for six consecutive days are considered to have resigned. The right to strike, which is recognised in Indonesian legislation, should be respested along the lines set forth by the ILO Governing Body and the ILO Committee of Experts.

III. Military Interference

Despite the repeal in January 1994 of Regulation 342/1986 which legitimised military intervention in labour disputes, intervention has continued. Moreover, other regulations which authorise intervention remain in place, such as Bakorstanas Decree No.02/Stanas/XII/1990. The military is well represented in the "official" union SPSI by the presence of retired military officers in key positions at the regional and local level. The overwhelming majority of strikes continue to be broken up by the security forces. Military members of the MUSPIDA or MUSPIKA often sit in on negotiations between workers and management. These interventions should cease.

IV. Women Workers

The still unresolved case of the murder of Marsinah in East Java (1993) illustrates the importance of women as labour organisers and their vulnerability to repression. Women workers face discrimination in pay and in the way their earnings are taxed (e.g. men can deduct for dependents, women cannot). It is no coincidence that much of the labour unrest in Indonesia has taken place in industries, for instance shoes and garments, that employ mostly women, Wages are often lower in this sector than in other industries. It is also no accident that women are poorly represented on the governing boards of the trade unions, SPSI and SBSI, and in workplace committees. Women in both the formal and informal sectors also face abuse and harassment, which the Ministry of Manpower often fails to investigate. Existing laws protecting women workers need to be explained to women and then fully implemented, but new laws may be needed to address some of the problems listed above. Mechanisms should be established by the Government and trade unions to receive and investigate complaints from women workers. Cases of discrimination should be investigated as a matter of routine practice.

V. Child Labour

In Indonesia, an estimated 2.3 to 2.9 million children between 10 and 14 years of age work in the industrial and informal sector. This means that one out of every ten children in this age- group is working. The problem of child labour most likely has much larger dimensions, if only for the general low standard of wages. While recognising the need of many Indonesian families to have their children work, it should be welcomed that the Government of Indonesia has acknowledged that child labour is major problem, and that it is investigating the problem in cooperation with the ILO and local NGOs. Instead of condoning abuses under Ministerial Regulation nr. 1 (1987), the Government should respect Labour Law No 1 (1951), according to which children under 14 years of age are forbidden to work. This Law has never come into effest owing to the lack of implementing regulations. Moreover, as late as December 1992, the Minister of Labour denied the existence of child labour in the formal industrial sector. Every step must be taken to protect child workers in Indonesia in accordance with the UN Convention on the Rights of the Child, to which Indonesia has been party since January 1990.

VI Overseas Workers

Driven by a lack of income and employment opportunities at home and attracted by chances to improve their lives abroad, hundreds of thousands of Indonesian workers have flocked overseas, to countries in Southeast Asia, the Middle East, Europe and the USA. Under the Sixth Five Year Plan (Repelita VI), the Indonesian Government has the target of sending 750.000 Indonesian workers abroad. The addition of illegal immigration to these figures leaves the number of Indonesian overseas workers (TKIs) considerably higher. It is estimated that in Malysia alone, no less than 900.000 Indonesian men and women are involved in work, which is commonly qualified as "dirty, dangerous and difficult". TKIs lack information and adequate protection. They are also suffering from unfair treatment. To overcome this situation, the Indonesian Government should:

a. Draw up a standard contract for TKIs, which will include hours of work, wages, social security, holidays etc. The contract should be available in Indonesian, next to the language of the host country;

b. Include the matter of training in recruitment regulations; c. Establish clear standards for the expenses which TKIs should pay;

d. Review the activities of recruiting agencies for violations of the TKIs rights and take action if such violations occur;

e. Create an overseas agency or division of the Indonesian Foreign Service, which will help the TKIs when they encounter problems abroad, supervise the recruitment agencies and manage the security deposits of the TKIs in a transparent way.

f. Consult with the TKIs when formulating policy and regulations to protect them. This also implies that the TKIs should have a right to an organisation in the host country, independent from the Indonesian Consulate or Embassy.

g. Establish bilateral agreements with different host countries to protect the TKIs, including a mechanism for the equitable resolution of disputes.

h. Distribute information to TKIs on the host country and its regulations for TKIs, on recruitment agencies and any other relevant matter.