Firms told to adobt democratic practices

Ridwan Max Sijabat, The Jakarta Post, Jakarta

The government has called on businesspeople and labor unions to adopt democratic practices and build pro-labor industrial relations to improve their position on the global market.

"In doing business, employers and managers need to upgrade workers' social welfare, skills and competence, which would in turn improve labor conditions and workers' productivity. On the other hand, labor unions and workers should boost their performance to help their companies grow and enable them to pay them more," Director General for Industrial relations at the Manpower and Transmigration Ministry Muzni Tambusai said here on Wednesday.

He was speaking at the signing of the 16th collective labor agreement between PT Unilever Indonesia and its workers.

The harmonious and equal partnership between the management and the workers was the company's strong point, helping it achieve major improvements over the last three decades, and deal with numerous problems resulting from the economic crisis, political instability and security problems in the last five years.

Muzni pointed out that without pay rises and training to advance their skills, workers would be more likely to go on strike.

Many companies have closed down over the last few years, not because of the prolonged economic crisis and security disturbances, but mainly due to unprofessional management, he said.

"Many other companies have achieved robust growth after giving top priority to the development of their human resources and forging a collective labor agreement through a democratic and transparent process. Under such a condition, workers will not go on strike to demand their normative rights if they know their employers are unable to comply with the labor law," he said.

Muzni called on small and medium enterprises (SMEs) to learn from Unilever, which he said had been successful in developing peaceful industrial relations for 32 years, so that it had grown to be a big publicly-listed company producing consumer goods for the domestic market and export.

Unilever's human resources director Josef Bataona, said his company strength lay in its commitment to maintaining qualified and prosperous human resources.

"With the collective labor agreement, the management is committed to raising the workers' social welfare, including wages, housing and medical allowances, by 11.35 percent or Rp 12.8 billion (US$1.3 million) in a couple of years," he said citing that workers' social welfare, labor training and promotion/appreciation were three key factors to improve workers' loyalty and their productivity.

He added that the company had provided training programs for workers, not just to improve their skills, but also to promote them to higher positions so that regeneration in the company had continued in a smooth manner.

He said that the lowest ranking workers in the company had been paid higher than the regional minimum wage, and that the wage gap in the company was relatively very small.

Former manpower and transmigration minister Jacob Nuwa Wea called for the management of Unilever to give a small portion of the company's stakes to their workers, to maintain their loyalty and help improve their productivity.