Pro-labor decree remains effective, says Nuwa Wea

JAKARTA (JP): The pro-labor Ministerial Decree No. 150/2000 on severance and service payments for dismissed and retiring workers remains effective until a tripartite solution to the much- criticized Decree No. 78/2001 is reached, says newly appointed Minister of Manpower and Transmigration Jacob Nuwa Wea.

"Employers are obliged to comply with Decree No. 150/2000, which has also been accepted in Central and East Java and Bali, until a national tripartite institution representing employers, the government and workers is set up to seek a fair solution to the prolonged problem of severance and service payments for retiring workers and those who are dismissed for major violations and crimes," Jacob told The Jakarta Post at the Ministry of Manpower and Transmigration here on Friday, prior to the inauguration of the new Cabinet

Nuwa Wea said he would hold a meeting with labor unions and the Indonesian Employers Association (Apindo) on Monday to make preliminary preparations for discussing the fate of Decrees No. 78 and No. 111/2001 that require employers to provide only compensation, instead of severance and service payments, for retiring workers and those who are fired for major violations.

He said he would lobby Apindo and local investors to accept the 2000 decree so as to help improve workers' protection in the future.

The 2000 decree stipulates that employers are obliged to provide severance payment for dismissed workers, including those who are fired for major violations and crimes, as well as service payments for resigning and retiring workers. It also specifies the amount of the severance and service payments based on the length of the particular worker's employment.

The latter two decrees were issued in June 2001 after protests by local and foreign investors against the pro-labor decree, and led to demonstrations and a number of violent labor rallies in East and West Java last month. So far, no tripartite solution to the problem of the controversial decrees has been achieved.

Nuwa Wea, also chairman of the Federation of All Indonesian Workers' Unions and a legislator with the Indonesian Democratic Party of Struggle (PDI Perjuangan), said he did not know the political reason why President Megawati Soekarnoputri appointed him as the manpower and transmigration minister, but pledged that he would work hard to help repair the current poor labor relations.

Meanwhile, the new labor minister's statement has raised a protest from the Association of Indonesian Footwear Companies (Apresindo) and the Indonesian Employers' Association (Apindo) who warned that it could affect industrial relations and discourage foreign investors from putting their money in Indonesia.

Anthon J. Supit, chairman of Apresindo, whose members are labor-intensive footwear factories, expressed his disappointment with the new minister's policy, saying it went against the previous tripartite agreement made between labor unions, the government and employers.

"Following his appointment as the manpower and transmigration minister, he (Nuwa Wea) is no longer a labor activist and, therefore, he should be wiser and make policies in the broader national interest," he said.

He warned that Nuwa Wea's statement might have deep repercussions, and that it could be cited by labor unions and workers when facing dismissal or retiring.

According to Anthon, many Japanese and Taiwanese investors have chosen the Philippines over Indonesia for investment because of the recent political instability and the country's contradictory labor laws.

Separately, Apindo's deputy chairman Djimanto questioned Nuwa Wea's statement which he said could have a negative impact on future investment.

"Nuwa Wea should not think that the law is his responsibility alone. He should first consult with the President and the other relevant ministers before making a new policy," he said.

With the new policy, he said, employers would be forced to set aside fresh or reserve funds in anticipation of resigning and retiring workers. They would also have to bear a financial burden whenever they had to fire those who had committed major violations or crimes.

He added Apindo was ready for negotiations with the governments and labor unions to seek a fair and peaceful solution to the issue of severance and service payments. (rms)