Government told to punish banks breaching labor laws

BOGOR (JP): Trade unions in the commerce, banking and insurance (NIBA) sectors called on the government to take action against a number of banks and insurance companies operating in Jakarta, for using employment agencies to get new recruits.

Bomer Pasaribu chairman of the NIBA unions, said yesterday at the opening ceremony of the union's national congress in Bogor, some 60 kilometers south of Jakarta, that the trend hurt workers and the practice was against the labor law.

"The government has not yet taken the proper steps to stop the practice. But it must stop this malpractice and punish the banks and insurance companies which have been dealing with brokers to get new employees," Bomer said.

According to Bomer, at least six private banks had paid labor suppliers to get new staff.

The banks employed the new employees on contracts. In case of dispute between the employers and the employees, the employers always said their direct dealings were with the suppliers, not the employees.

"Employees are always in weak position in case of dispute," Bomer said.

The revised labor law, issued in 1969, allowed the contracts only for workers on probation and for part-time jobs, while a Ministerial Decree, issued by Minister of Manpower Abdul Latief in Jan. 1996, phased out the use of daily workers and the contract system from permanent jobs.

NIBA is one of 19 sectoral trade unions under the umbrella of the government-recognized Federation of All Indonesian Workers Union (FSPSI). The congress, the first since it was founded in 1995, was to discuss the coming free trade era.

Bomer said the use of labor supply companies helped employers safeguard investment and keep down labor costs.

"With contracts between the workers and supplier companies, the banks and insurance companies need no more industrial relations, collective labor agreements (KKB), or negotiations with their workers because all things concerning workers depend on the contract between the workers and their suppliers.

"The employers could easily and arbitrarily dismiss workers without severance pay," he said. "Under the contract system, workers would certainly loose their basic rights."

Speaking of the new daily minimum wage, to be implemented next month, Bomer said the government should have taken workers' families into consideration.

"Up to now, the monthly minimum wage has been set with single workers in mind, without (considering) their families and this is not in accordance with the 1993 State Policy Guidelines (GBHN)," he said.

He expressed his deep concern over the low minimum wages in the country, saying that they were the lowest of the ASEAN countries. The minimum wage differs in each province. For the Greater Jakarta area, for example, the current minimum monthly wage for a worker is Rp 156,000 (US$68), and the new wage will be Rp 172,000.

"The minimum wage is still below the minimum need while the country's economic growth has reached over seven percent annually," he said. "It's time for workers to also enjoy the fruits of national development." (rms)