Wed, 09 Jul 2003

Insurance essential for RI's overseas workers

The Jakarta Post, Jakarta

The government appears to be at a loss to know what to do as a result of the increasing refusals by labor exporters to take out insurance cover for Indonesian workers overseas.

The key problem is that according to the ILO Convention on Migrant Workers and Law No. 13/2003 on labor protection, Indonesian workers, both at home and overseas, have the right to protection, and basic insurance schemes are obligatory, but in practice both the government and the labor exporters have shown no commitment to protecting workers abroad.

The Ministry of Manpower and Transmigration insisted on Tuesday that Ministerial Decree No. 157/2003 on worker insurance was obligatory, saying that all labor exporters were obliged to take out insurance cover on the workers they sent overseas from an insurance company to provide protection in cases of dismissal, medical expenses and occupational accidents.

"The insurance scheme is aimed at providing compensation to workers who are dismissed by their employers, for medical expenses and in respect of occupational accidents, including fatalities," said Ministry of Manpower and Transmigration spokesman Hotma Panjaitan.

Panjaitan was responding to the rejection by many labor exporters of Ministerial Decree No. 157/2003 on insurance for Indonesian workers overseas, which was issued by Minister of Manpower and Transmigration Jacob Nuwa Wea recently.

Association of Indonesian Labor Exporters (Himsataki) chairman Yunus Yamani said here on Monday that many labor exporters opposed the ministerial decree because, in their opinion, the decree was highly unusual, and there was no legislation requiring labor exporters to register workers with an insurance company.

Panjaitan explained that the issuance of the ministerial decree was based on the law, and recommendation of the director for insurance at the Ministry of Finance that companies provide insurance cover for workers.

According to the decree, labor exporters are obliged to pay Rp 400,000 (US$48) as a premium to the insurance company for every worker they send abroad.

He failed, however, to recount the issue's historical background, which clearly showed a lack of government commitment to providing insurance protection for workers overseas.

Since the 1980s, the government has issued many decrees requiring labor exporters to insure workers employed overseas, but the insurance programs have yet to give maximum benefits to workers.

From the 1980s until 1997, workers employed overseas were covered by state-owned PT Jamsostek, but former manpower minister Abdul Latief halted the cooperation with Jamsostek and set up his own company to run a commercial insurance scheme for more than one million workers overseas. The company collected around $28 million without paying any compensation to workers.

In 1997, former manpower minister Fahmi Idris appointed a consortium of private insurance companies to run insurance programs for workers. The programs were halted in 1999 as labor exporters demanded a cut of the consortium's annual profit.

Former manpower minister Bomer Pasaribu issued another decree requiring labor exporters to insure workers sent overseas, but most labor exporters did not abide by it as they were already charged with taking responsibility for all difficulties befalling Indonesian workers abroad.

Many sides have called on the government to restore the insurance program for workers to Jamsostek as besides the obligatory nature of the social security programs required under Law No. 3/1992, the state-owned company is considered financially capable of covering any problems befalling Indonesian workers overseas.

According to those in favor of a Jamsostek scheme, the government would have had no financial problems in handling the 375,000 Indonesian workers the Malaysian government expelled last year if the workers had been covered by a social insurance program as was the case when Jamsostek transported around 40,000 illegal Indonesian workers home from the Middle East in 1994.