New law, new hope?
New law, new hope?
Given this country's poor record in industrial relations in
the past, it is not surprising that the new Law on the Settlement
of Industrial Disputes, which the House of Representatives
endorsed this week, is viewed with suspicion by activists in
certain segments of the labor movement.
Nevertheless, the new law, which is more widely known by its
Indonesian acronym, the PPHI, and which now only needs the
President's signature to come into effect, represents a
considerable step forward. Employers and labor unions have both
given their support to the new legislation, which they hope will
help to enhance the investment climate in this country by
guaranteeing greater legal certainty for both workers and employers.
In contrast to many earlier pieces of legislation concerning
worker-employer relations, the new law was written in
consultation with, and with the full participation of, labor
unions, employer organizations, the government and the national
legislature. Although the newly endorsed law provides for the
setting up of a special court to adjudicate on labor disputes,
the government, through its Central Committee for the Settlement
of Labor Disputes (P4P), will still be required to help labor
unions reach out-of-court settlements with their employers if
they should prefer to work out fair and quick settlements.
Ironically, it is precisely this role accorded by the PPHI
legislation to the government that a number of labor unions
oppose -- mindful, perhaps of the experience of the past when the
government invariably sided with employers in labor disputes.
However, as the secretary-general of the All-Indonesia Workers
Union (KSPSI), Syukur Sarto, remarked, the KSPSI supported the
government's role "because of the corrupt judicial system in this
country." It would, after all, be cheaper for the employers, who
have the money, to buy off a panel of only three judges to get a
ruling in their favor than it would be a 15-member committee
appointed by the government to settle the dispute.
At the other end of the scale, most employers too welcomed the
new legislation. In the view of the Indonesian Employers
Association (Apindo)'s secretary-general, Djimanto, for example,
the new law should give investors the legal certainty they needed
to work in this country. The new law, according to the Apindo
official, "stipulates quick and fair legal proceedings" in
seeking settlements to industrial disputes between workers and
employers. "Employers will no longer have to wait five years as
they did in the past in dealing with disputes with their
workers."
The only thing that remains now is for President Megawati
Soekarnoputri to put her signature on the document. In any case,
the law says that even if she should fail to do so within 30 days
after the House gives the document its endorsement, the law will
automatically come into effect.
On paper, then, the new Law on the Settlement of Industrial
Disputes appears to have given this country at least the hope
that it can finally leave the turmoil of its industrial relations
history behind it. Of course, a lot more is needed than words to
rebuild an economy that has for years been battered by what is
beyond doubt one of the worst crises this country has experienced
since independence.
Now that an accord has been reached between some of the most
pertinent elements in the sphere of industrial relations, what
remains to be done is to build up the commitment that is needed
to make the new law work in practice. Judging by what we have
seen in the past, though, this will be much easier said than
done. However, if the nation is sincere in its efforts to lift
itself out of the slump it is currently wallowing in, there is no
time to be lost.