Union leaders decry deal with cigarette firms

JAKARTA (JP): Leaders of the All-Indonesia Workers Union Federation (FSPSI) are outraged by their branch representing the cigarette industry, which cut a deal with cigarette companies to postpone the enforcement of a government ruling on new minimum wages.

Federation chairman Datoek Bagindo said the deal, struck by Tosari Wijaya, the chairman of the Federation's Union for Cigarette, Tobacco, Food and Beverage Workers, was a "sell-out".

"We will summon Tosari and other executives of the trade union to explain the deal which is detrimental to the workers," Bagindo was quoted by Antara as saying on Saturday.

According to the news agency, Tosari "quietly" signed the deal with the Association of Indonesian Cigarette Manufacturers on March 31 to delay by one year the implementation of the new rule concerning minimum wages, which came into force on April 1.

Tosari, who is better known to the public as the Secretary- General of the United Development Party (PPP), was not available for comment yesterday.

The ruling, outlined in a decree by Minister of Manpower Abdul Latief, requires companies to calculate the minimum wages paid to all workers, both permanent and temporary, based on 30 days per month as opposed to 25 days under the old regulation.

The decree came into effect as the government was hiking daily minimum wages by an average of 10 percent.

While most companies have no objections to the rise, several have said the new means of calculating monthly minimum wages could put them out of business as it gives the companies less flexibility in hiring temporary workers.

Minister Latief, himself a former businessman, has defended the decree but has agreed to discuss the ruling again with Coordinating Minister of Production and Distribution Hartarto.

According to Antara, the deal is estimated to save cigarette manufacturers, which employ more than 200,000 workers, Rp 51 billion ($22 million).

Bagindo said the deal signed between cigarette worker representatives and the companies was senseless. "It raises questions about what is going on. Why should the workers give up their rights to employers?"

Other top executives in the Federation were equally outraged.

Marzuki Achmad said that there is no legal reason why any company should deny workers their full entitlement provided in the new regulation.

Wilhelmus Bhoka expressed his regret that the Federation's struggle and the government's intention to improve the minimum wage system had to be marred by this kind of dealing.

In the absence of any explanation from the cigarette trade union, rumors of back-room dealing have begun to circulate.

Antara said that a Federation executive claimed that he once received a phone call from a cigarette manufacturer asking for the bank account number of a cigarette trade union leader in Jakarta to which he wanted to deposit Rp 210 million ($91,000).

"If there was collusion, this is clearly a violation and the culprit must be firmly punished," Bagindo said. (emb)