ILO defends RI workers amid investment outflows

ILO defends RI workers amid investment outflows

Moch. N. Kurniawan, The Jakarta Post, Jakarta

The International Labor Organization (ILO) came to the defense of
Indonesian workers on Friday, saying that unproductive laborers
should not be considered as the only factor hindering the economy
here.

"I doubt that the labor issue is the major problem causing
investors to flee from here. What I see is Indonesia is on the
right track as all parties are trying to improve the labor
system," ILO director for Indonesia Alan Boulton told the Jakarta
Post.

Admitting that the country's workers had to improve
productivity, Boulton stressed that political and legal
uncertainties as well as rampant corruption were the major
problems that had caused many companies to relocate elsewhere.

The Korean Chamber of Commerce warned the government on
Thursday that South Korean firms would pull out of Indonesia if
it failed to address various labor problems ranging from
unfavorable labor policy, soaring increase of wage, poor
productivity and constant strikes.

Recently, U.S. footwear manufacturers Nike and Reebok cut back
their operations in the country, citing increasing labor
problems.

Some foreign and domestic firms have also criticized two new
labor bills currently being deliberated in the House of
Representatives (DPR), saying that they were too pro-worker and
hurt their businesses.

Minister of Manpower and Transmigration Jacob Nuwa Wea said
this week that the government would revise some 35 chapters of
the bills which have been widely rejected by the country's
workers.

Boulton hailed recent meetings between labor unions and the
Ministry of Manpower and Transmigration, as well as the business
community and the ministry as part of efforts to create good
labor laws.

However, Indonesia had to concern itself with its workers' low
productivity which has eroded its competitiveness, he added.

"Workers here must improve their productivity to compete with
workers in other countries," he said.

According to the World Bank, there are increasing signs since
early 1990s that Indonesia's competitiveness is being eroded by
several factors: rising labor costs, low worker productivity and
increasing industrial unrest.

Minister of Manpower and Transmigration Jacob Nuwa Wea said
earlier that an average Indonesian worker produced six times less
than an average Malaysian and eight times less than an average
Japanese worker.

Boulton supported the current debates over labor bills
however, which were focused on recognizing labor rights, not
allowing military intervention in industrial disputes and
regional administrations' power on addressing manpower issues.

The bills guarantee workers freedom to choose his or her
worker union, a right that workers did not posses in the previous
law. Workers would also have the right to negotiate with
employers on working terms and conditions, while in the past
employers were totally in control of the workers.

There would also be a guarantee in the system that no military
intervention in resolving disputes between workers and employers,
which was dominant in the past.

The authority of regional administrations to deal with local
manpower problems would be legalized under the proposed law.

Meanwhile, senior executive at the Indonesian Workers Union
(SPSI) Arif Sujito warned the government to meet its promise to
revise 35 chapters of the labor bills.

According to him, three crucial issues: the approval from the
Industrial Relations Settlement Court (PPHI) on worker dismissal,
criminal action and a code of conduct for strikes, are among
articles that have to be revised.

Arif said on dismissal matters, approval from PPHI was
important to prevent employers from arbitrarily dismissing
workers.

Regarding criminal action, he said, wrongdoing such as
cheating, or theft should be categorized as a major fault,
therefore those who carry out such practices would be only
punished by dismissal.

At present, those wrongdoings are considered a crime, which
can be tried in the criminal court.

On strikes, the new bills may stipulate that the employer must
pay workers who go on strike but follow the proper procedures,
Arif said.