New labor law<\/p>\n
Both workers and employers won some and lost some in the labor
\nlaw that was approved by the House of Representatives on Tuesday
\nafter more than five years' delay that was marred by intermittent
\nlabor demonstrations.<\/p>\n
The law on the development and protection of workers' rights,
\ncalled the Manpower Law, will annul more than a dozen previous
\nlaws, notably the controversial Manpower Law No. 25\/1997 enacted
\nduring Soeharto's authoritarian rule, and the so-called time-bomb
\nLabor Regulation No. 150 that was issued by then manpower
\nminister Bomer Pasaribu in June 2000.<\/p>\n
Law No. 25, which has never been enforced, fully reflected
\nSoeharto's repressive labor policies that legalized and promoted
\nthe exploitation of workers in the name of industrial
\ncompetitiveness to fuel high growth and to compensate companies
\nfor the heavy costs of corruption.<\/p>\n
However, Labor Regulation No. 150 swung the pendulum too far
\nin favor of workers, stifling new investment and prompting
\nexpanding companies to hire temporary workers to circumvent the
\nrigid rules. The regulation reflected the euphoria of the
\nworkers' newfound freedom of expression and association that
\ntended to drive trade unions into radicalism to advance their
\ninterests.<\/p>\n
The new law seeks a middle ground, striking a good balance
\nbetween the objectives of spurring new investment to create jobs
\nand of protecting basic workers' rights, as well as ensuring the
\nbest welfare possible for workers within the context of the
\nIndonesian condition.<\/p>\n
Obviously, neither party could be accorded their complete
\ndemands.<\/p>\n
Workers stood to lose the most if the legislation had been too
\npunitive toward companies, as this would have further dampened
\nthe demand for workers in the already glutted labor market, with
\nalmost 40 million unemployed and underemployed people and an
\nannual supply of 2.5 million new job seekers.<\/p>\n
On the other hand, companies that inhumanly exploit their
\nemployees never last, and cannot maintain their competitiveness
\nfor long, not only because such a practice creates violent
\nindustrial relations and disrupts operations.<\/p>\n
Besides, such inhuman treatment of workers in the formal
\neconomy is rather improbable under the current democratic era
\nthat guarantees freedom of expressions and association, as the
\ninternational market has been shunning companies that do not
\ntreat their workers properly.<\/p>\n
The law guarantees minimum standards for decent working
\nconditions, the workers' right to strike, and severance and
\ncompensation payments. It goes a long way toward providing what
\nworkers badly needed -- stronger bargaining power -- through
\nregulations that protect the labor market from the rigors of the
\ndemand-supply mechanism.<\/p>\n
A freewheeling labor market would never work in the interest
\nof workers, given the unequal status of employers and employees,
\nand because in the bread-and-butter terms of jobs and wages, the
\ninterests of employers and workers often oppose each other.<\/p>\n
The law stipulates clear-cut, elaborate provisions on the
\nrecruitment and rights of temporary workers and the outsourcing
\nof services to other companies, which all boil down to more
\nsevere restrictions on such practices. For example, companies are
\nbanned from outsourcing services that are part of their permanent
\nproduction process or core business. Likewise, temporary workers
\ncannot be hired for jobs that are an integrated part of the
\nproduction process.<\/p>\n
However, the law also annuls current rigid rules, such as
\nthose that ridiculously required employers to provide severance
\npay and service benefits to workers who have voluntarily resigned
\nto seek greener pastures, and to those who have been found to
\nhave commuted crimes.<\/p>\n
The new law seems to be the best trade-off between the
\ninterests of workers and employers that could be achieved by the
\ngovernment and the House, out of a realization that an overly
\nprotective legislation could kill the industrial goose that lays
\nthe golden egg -- discouraging new investment in labor-intensive
\nbusinesses and prompting existing companies needing expansion to
\nhire temporary workers.<\/p>\n
However, the new legislation should still be supplemented with
\nanother law which will govern the settlement of labor disputes. A
\nbill on the step-by-step process of resolving disputes between
\nemployees and employers through the labor court is still pending
\nat the House.<\/p>\n
It is most urgent for the House to speed up deliberations on
\nthe bill, as it will provide the legal basis for the
\nestablishment of a labor court in every district court and will
\nalso govern fund-raising by trade unions to support members on
\nstrike, the instrument of last resort for workers to exert their
\nbargaining power.<\/p>\n
However the labor court is to be designed, the trial
\nprocedures and proceedings should be unambiguous, more expedient,
\nunderstandable to the parties involved, and bearable with regards
\nto costs incurred, than the arduous procedures currently applied
\nby the regional and central labor tribunals.<\/p>\n
At the end of the day, though, the labor law is merely
\nwritten rulings that have yet to be translated into individual
\ncompany regulations and collective labor agreements. It has also
\nyet to be enforced in a steadily changing economic condition,
\nwhich has different impacts on the various industry sectors in
\nwhich businesses operate -- and provide jobs.<\/p>\n
The management of peaceful industrial relations will still
\ndepend very much on how capable company or factory trade unions
\nare in developing effective bargaining relationships with
\nemployers; and how transparent and honest are employers with
\nregards to the condition of their businesses, and how willing
\nthey are in allowing employee participation in the decision-
\nmaking process in matters related to workers' interests.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/new-labor-law-1447899208",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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