Joint employer-worker office to be set up

Adianto P. Simamora, The Jakarta Post, Jakarta

The Employers' Association of Indonesia (Apindo) said on Tuesday that it would set up a joint office between employers and workers as part of efforts to resolve the long-standing labor problems in the country.

Chairman of Apindo Sofjan Wanandi said that the move would also be aimed at reducing the government's intervention in resolving labor conflicts.

"We shall collate all complaints, both from employers and workers, in the planned joint office and try to seek solutions as quickly as possible."

"We shall also try to minimize the intervention of the government in resolving labor conflicts, as businesses want to seek a concrete solution," Sofjan told reporters after announcing the new board members of the association.

Among the association's members are Mochtar Riady, Sukamdani Gitosardjono, Ciputra, The Nin King, Aburizal Bakrie, Eva Riyanti Hutapea, Sukanto Tanudjaja, Subronto Laras, Theodore P. Rachmat, Alim Markus and Rahmat Gobel.

"This is the first time in the country that businesspeople have been ready to sit in Apindo. I have also asked foreign investors to join with us," he said.

He said that U.S.-based gold and copper mining company PT Freeport Indonesia, for example, had sent personnel to become actively involved in the day-to-day operations of the association.

Sofjan said that in the near term, Apindo would focus on resolving labor conflicts to help regain both foreign and domestic investor confidence in the country.

"We have to quickly resolve existing labor issues if we want to attract investors and help create new jobs for millions of unemployed people in the country," he said.

Lingering labor conflicts have been cited as one of the main reasons for the relocation of many companies to other countries, such as Vietnam and China.

Analysts said that these problems had caused foreign and domestic investors to shun the country.

Investment approvals have been declining since the country plunged into a combined economic and political crisis in 1997.

In 2002, foreign direct investment approvals, for example, plummeted by 35 percent, to US$9.7 billion from the previous year's $15.06 billion, while domestic investment approvals dropped by 57 percent, to Rp 25.26 trillion from Rp 58.62 trillion.

Boosting investment is vital for the recovery of the country's ailing economy and to help meet the target of 4 percent economic growth.

Sofjan was very active in demanding the government revoke ministerial decree No. 150/200 on labor, which had been overly protective of workers at the expanse of employers. Consequently, in March this year, President Megawati Soekarnoputri signed a new manpower law, which guarantees the rights of both workers and employers.

However, the government has yet to issue supporting presidential and ministerial decrees to implement the new manpower law.

"We have set up a team to help the government formulate the supporting decrees. We are hopeful the decrees can be issued this year," he said.