Lift decree on temporary oil workers, says Minister
Moch. N. Kurniawan, The Jakarta Post, Jakarta
Turning his attention to the fate of hundreds of thousands of workers in the country's oil and gas sector, Minister of Manpower and Transmigration Jacob Nua Wea has called for the revocation of a ministerial decree which allows oil and gas companies to employ workers on a temporary basis for up to 20 years.
Jacob criticized Ministerial Decree No. 5/1995 as failing to respect workers as human beings.
"The decree allows oil and gas companies, and contractors, to hire workers on a temporary basis for 20 years. It holds out no future prospects and weak legal protection for workers.
"This is not right. So I've asked Minister Purnomo to revoke the decree," he said, referring to Minister of Energy and Mineral Resources Purnomo Yusgiantoro.
He spoke after signing a joint collaboration agreement between his ministry and the Ministry of Energy and Mineral Resources on the establishment of a forum to study labor affairs in the energy sector.
Under Minister of Manpower Decree No. 2/1993, a company can only contract fixed term workers for two years and can only extend the contract for a further one year.
Analysts say the establishment of the forum is a strategic move by the Ministry of Manpower and Transmigration to start reforming the labor system in the oil and gas sector, which has for decades been tightly controlled by state oil and gas company Pertamina.
No data was immediately made available by Pertamina on the total number of temporary workers in the sector, but in Riau- based American oil and gas company PT Caltex Pacific Indonesia, the country's largest oil and gas company, there are about 20,000 temporary workers, compared with 6,000 permanent workers.
There are now 43 oil and gas contractors, mostly foreign companies, operating in the country.
The temporary workers, hired from recruitment agencies, are mostly unskilled workers doing menial jobs at various stages of oil and gas operations, including exploration and production.
The issue of temporary workers hit the headlines in local papers over the past few years when thousands of those who worked for Caltex and Vico Indonesia, an American company operating in East Kalimantan, staged demonstrations for weeks, demanding, among other things, that they be hired as permanent workers. Many of them claimed to have been working for the companies for many years.
Caltex spokesman Renville Almatsier said Caltex finally settled the dispute last November by paying compensation to some workers and making other employees permanent.
However, he admitted that some contractors had still to meet the demands of their non-permanent workers.
Separately, an official of state-owned oil and gas company Pertamina, who requested anonymity, said that Jacob's proposal was not viable as the oil and gas industry was not labor intensive but rather capital intensive.
He also said the industry required high technology and was associated with high risk. Therefore, only those who possessed high skill levels could be employed permanently in the sector.
The temporary workers were mainly those with lower skills, such as security guards and truck drivers, he added.
"The proposal also comes when the oil and gas industry is being asked by the government to be more efficient. It could give rise to legal uncertainty," he told The Jakarta Post.
According to the official, Pertamina had sent a letter to Purnomo urging him to carefully consider Jacob's proposal at a ministerial meeting as the issue involving many people.
Regarding the study forum agreed upon on Wednesday, Jacob said it was aimed at preparing policy regarding labor affairs in the energy sector.
The forum is aimed at developing training and education programs for the oil and gas sector.