Many employers cheat on worker insurance

Ridwan Max Sijabat, The Jakarta Post, Jakarta

State-owned social security company PT Jamsostek is encouraging employees to check their participation in the social security schemes as many employers were found to be dishonest in registering their employees with the mandatory insurance programs.

"Employees have the right to know whether they are registered with all the four insurance schemes and whether their premiums paid by their employers to Jamsostek are based on their actual monthly salaries," Jamsostek president Achmad Djunaidi said.

Djunaidi made the call when he paid on Thursday compensation for five workers of PT Nestle Indonesia who were killed in a vehicular accident on the Jakarta-Bogor toll road last month.

He revealed that 50 percent, or more than 50,000, of 108,000 companies participating in the social security program, have registered only some of their workers and reported their actual monthly salaries to Jamsostek, in an attempt to reduce the financial burden of joining the programs.

"Workers who are not registered with Jamsostek gain no insurance benefits when they fall sick, experience work-related accidents or enter their mandatory retirement age of 60.

"The smaller the premium workers and their employers pay to the insurance schemes, the less benefit they will gain," he said.

According to Junaidi, workers should file complaints about their management to the Ministry of Manpower and Transmigration if their premium is not paid in line with their monthly salaries as is required by law.

Law No. 3/1992 on social security programs stipulates that all companies employing ten workers or more are obliged to participate in the social security programs which comprise of a health care scheme, occupational accident scheme, compensation for next of kin in case of death and a pension scheme.

Of the 13.7 percent premium to be paid for the four schemes, workers are obliged to pay 2 percent while the remaining 11.7 percent is covered by their employers.

Djunaidi reiterated that the benefits workers gain, depends on the amount of premium they pay.

"Many workers are unaware of the benefits of the basic insurance schemes because they do not pay their premium directly to Jamsostek," he said.

He cited as an example that the families of two workers of the Sari Club who were killed in the Oct. 12, 2002 bombing in Denpasar, Bali gained only around Rp 9 million (US$1,097) in compensation from Jamsostek because their employer reported to Jamsostek that their monthly salary was only Rp 170,000.

"The manpower and transmigration office in Denpasar should take action against the employer because the report was completely inaccurate since the minimum wage in the province last year was Rp 341,000.

The family of the director of the North Sumatra Development Bank who was killed in a collision in Jakarta last year received compensation amounting to only Rp 40 million because his company reported to Jamsostek that his monthly salary was only Rp 1 million.

"But, it's impossible that a bank president would be paid only Rp 1 million per month," he said, explaining that such deceit has affected recipients of the insurance program.

According to the law, a worker who is killed in a work-related accident has the right to forty-times or 4,000 percent of his or her monthly salary which is paid to his/her next of kin.

Ira Yovita, one of Nestle's workers killed in the traffic accident gained more than Rp 181 million in compensation and pension funds which was paid to her parents.

Ira, who had been employed for seven months in the foreign company received a monthly salary of Rp 5 million, which was reported transparently to Jamsostek by Nestle.

Jamsostek's operation director Djoko Sungkono said his company was still promoting the social security law to improve employers' awareness of the importance of insurance coverage for their employees.

"Besides, the government through the manpower and transmigration minister should start enforcing the law to help provide protection for Indonesian workers both at home and overseas," he said.

Djoko added that the House of Representatives would likely revise the law to allow Jamsostek to appoint special staff to enforce the law as is done in many other countries.