Government reviews pro-labor decree

Government reviews pro-labor decree

JAKARTA (JP): Labor unions are threatening massive strikes
following Minister of Manpower and Transmigration Al-Hilal
Hamdi's decision to amend controversial Ministerial Decree No.
150/2000 on employment termination which allows employees to
receive a substantial payout regardless of whether they resign or
are dismissed.

Labor unions charge that the government buckled under pressure
from foreign investors and big businesses.

The amendment, issued on Friday, annuls the requirement to
provide severance and service payment to workers who either
resign or are fired for committing major violations.

According to Tianggur Sinaga, spokeswoman for the Ministry of
Manpower and Transmigration, these workers would only receive
compensation money.

"Workers who wish to resign are obliged to lodge a written
notice 30 days beforehand," she told The Jakarta Post by
telephone here on Saturday.

She added that the new decree also allowed employers to limit
the number of resigning workers within a certain period.

The previous decree stipulated that compensation consists of
the basic annual leave, along with financial support for
transport, health and housing facilities.

Workers who leave a company for reasons other than
resignation, retirement or dismissal due to a major violation
retain their right to receive severance and service payments
along with compensation money.

Regarding the severance payment, workers employed less than a
year will receive the equivalent of a month's salary, those
employed between one and two years receive 200 percent of their
salary, between two and three years get 300 percent and so on.

The highest severance pay is 700 percent for those who have
worked for six years or more.

Concerning service payment, workers employed between three to
six years get 200 percent of their monthly wage, between six to
nine years receive 300 percent of their wage, between nine to 12
years get 400 percent.

The most that can be received is 1,000 percent of their wage
for those who have worked 24 years or more.

According to Tianggur, employers are not obliged to provide
severance and service payments for retiring workers who are in a
pension fund.

"If retirees are not in any pension fund, they can receive 200
percent in severance pay, 100 percent in service payment and 100
percent in compensation money," she said.

The amendment also stipulates that workers who do not turn up
for work for five consecutive days to participate in an illegal
strike will be considered absent without permission.

"This ruling wants workers to comply with the official
procedure when they are going to go to strike, and those
violating it can have sanctions imposed on them by the
management," said Tianggur.

She said that according to the law, workers have a right to
stage a strike to fight for their interests, but they are obliged
to undergo bipartite or tripartite negotiations with the
management and/or government mediators before striking.

"And workers are obliged to inform their employers and
security authorities, including the police, if they want to go to
strike," she said.

Tianggur claimed that the substance of the amendment had been
discussed with labor unions, businessmen, local non-governmental
organizations and foreign investors.

Reactions

When the initial ministerial decree was issued in 2000 by then
minister Bomer Pasaribu, employers and foreign investors were up
in arms.

Over the past week it was labor unions who charged that the
government had acquiesced and was victimizing workers to serve
the interests of foreign investors.

The All-Indonesia Workers Union Federation (FSPSI) warned that
it would mobilize its 11 million members to stage industrial
strikes and rallies until the amendment was revoked.

"We have established strong coordination with our sectoral
unions to deploy their members to stage strikes in their
workplaces. It is impossible for us to accept such a decree which
is a serious betrayal of our right to protection," Jacob Nua Wea,
chairman of FSPSI, told the Post on Sunday.

He warned that the situation would worsen and the government
would lose public confidence if the minister refused to repeal
the amendment.

"The issuance of the new decree has raised a new problem that
will certainly worsen the mounting conflict between the
government and the House of Representatives," he said.

Muchtar Pakpahan, chairman of the Indonesian Prosperity Trade
Union (SBSI) concurred and said the amendment was evidence that
the government was not committed to improving labor conditions in
the country.

"Workers in East Java, especially in industrial bonded zones
in the province, will come to Jakarta to ask for President
Abdurrahman Wahid's accountability regarding the decree," Muchtar
said.

Ariest Merdeka Sirait, deputy chairman of the Confederation of
Independent Labor Unions (GSBI), regretted the amendment, which
he said exhibited the government's weak bargaining power vis-a-
vis foreign investors.

"The amendment implicitly shows that the government is bowing
to pressure from foreign investors, and labor conditions will
remain poor in the future," he said.

Not surprisingly, Djimanto, deputy secretary of the Indonesian
Employers Association (Apindo), hailed the amendment as a win-win
solution.

"It is unfair and burdensome to employers if they are obliged
to provide severance and service payments and compensation money
for resigning or retired workers and to those dismissed for major
wrongdoings," he said.

He noted that even under the amendment, employers could not
dismiss their workers arbitrarily.

"Employers are also obliged to pay money to retiring workers
whose pension funds are less than the severance and service
payment level," he said. (rms)