10,000 jobs on the line, official says

JAKARTA (JP): Some 50 companies have asked the government for permission to dismiss 10,000 employees because of economic difficulties caused by the monetary crisis and forest fires, a senior Ministry of Manpower official said yesterday.

"Most of the companies have asked for the authorization to dismiss their employees," S. Sianturi, director of work rules at the Directorate General of Industrial Relations Counseling and Manpower Control, said.

"They come from various fields, including plywood, sawmill, textile and shoes," Sianturi said after witnessing the signing of a new collective labor agreement between management and employees of PT Unilever Indonesia.

He declined to name the companies, but said their managements had tried to settle their problems with workers' representatives before turning to the government.

"Most have reached agreements with the workers, including on the question of severance pay," he said.

The number of jobs on the line could swell the 6,000 lost because of the government's decision on Nov. 1 to close 16 private banks, Sianturi said.

He suggested the banks redeploy employees instead of firing them.

"Most of these banks are members of particular holding companies."

The manpower law requires all companies to inform the government of any decision to dismiss workers.

The monetary crisis has severely hit the property sector, and textile and shoe manufacturers. Many companies have been forced to either close down, or scale down employment.

Sianturi said wood-based companies affected by the forest fires were among the 50 companies applying to dismiss workers.

He said his office had been closely monitoring companies' activities in view of the monetary crisis, and had been producing a weekly report on the situation.

There could be more companies seeking to dismiss their employees to cope with the economic downturn in the coming weeks, he said.

Some companies tried to avoid laying off their workers by cutting working hours. "At least four or five companies have reported decisions to cut working hours or shifts," he said.

One company has suspended its entire workforce with pay, he said.

He appealed to the companies to give priority to their old workers if and when the situation improves and they decide to hire more workers. (cst)