Mutual understanding key to ending labor rows

Fabiola Desy Unidjaja and A'an Suryana, The Jakarta Post, Jakarta

Rachmat, a middle-aged man, feels that his life is currently in limbo. He recently lost his job at a garment factory, located in the outskirts of Jakarta.

His sad story dates back to January this year, as his labor union demanded a salary hike, pushing the employer to meet the demand by February at the latest.

Following a series of strikes, the employer finally agreed to meet the demands, promising to raise wages and settle back pay by June this year.

Due to the workers' failure to agree among themselves, they finally rejected the offer and decided to go on with the strike.

In an unexpected move, the company ceased operations in March, the employer reportedly fleeing to Taiwan, claiming that he was unable to meet the workers' demands.

Rachmat stated that, as time went by, he finally accepted the reality of losing his job. However, in another way, he still regretted they way in which it had happened.

"If we hadn't pushed the employer too much, we might not have lost our jobs," said Rachmat, who was currently forced to do whatever he could to meet his family's basic needs.

Such an experience portrays precisely the dilemma that is being faced here by both workers and employers alike.

On the one hand, workers fight for improved conditions, while on the other, employers try to minimize their labor costs.

Mutually agreed settlements are rarely achieved, resulting in widespread labor protests around the country, especially during the reform era.

The large number of labor protests is not at all surprising, because workers here have yet to earn a decent income.

The minimum wage for workers is around US$ 35 per month on average, the lowest in Asia, after Bangladesh.

Moreover, in practice, many workers are paid even less than the government-set regional minimum wage.

In Jakarta, for example, shop workers are usually paid about Rp 300,000 to Rp 400,000 per month, far below Jakarta's regional minimum wage of Rp 592,000.

However, employers seem to take a different line to defend their policy of paying minimal salaries to their workers.

Marketing manager of Samsung Electronics Lee Kang Hyun complained that the economic downturn had diminished companies' ability to pay a decent income to workers.

Businessman Djimanto agreed, saying that employers had carefully calculated the capacity of their companies to pay their workers.

"If the increase in labor costs is unbearable, employers will be driven out of business and this could result in further unemployment," warned Djimanto, also secretary general of the Indonesian Employers Association (Apindo).

Industrial relocation, obliquely referred to at the beginning of this story, is another threat that is often spoken about and appears to be carried out by employers.

Data on business relocations is not available, but many reports have shown that some companies operating in Indonesia have relocated their factories to labor-friendly countries such as Vietnam.

However, various parties in Indonesia have lashed out at the employers, who have always tried to magnify contentious issues to curb labor protests.

Minister of Manpower and Transmigration Jacob Nuwa Wea bluntly said that the issue was merely manipulated by employers for their own interests.

He said that he visited Vietnam recently, but he had not found any companies, formerly operating in Indonesia, which had relocated their industries to Vietnam. "The only factory that relocated to Vietnam was the one belonging to Sudono Salim, which employs 126 workers," said Jacob recently.

Labor activist Dita Indah Sari echoed Jacob's statement, saying that the relocation process was costly and not easily achieved.

In order to strike a delicate balance in this contentious issue, labor expert Fauzi Abdullah proposed that both parties should allow the tripartite agency, the Labor Disputes Settlement Committee (P4P), deal with their cases.

He said that the committee was very useful in helping to settle industrial relations disputes.

However, the effectiveness of the committee to deal with problems needed to be improved, he said on Wednesday.

One thing that ought to be eradicated was the widespread collusion between government officials on the committee and employers, resulting in workers' interests being ignored, he said.

Lee Kang Hyun said that mutual understanding between both parties was essential to end disputes.

"The companies must be transparent in financial matters, and workers should not make unreasonable demands.

"Should that be the case, mutual trust between both sides could prevail," he said.