Government sued over insurance plan for migrant workers

The Jakarta Post ,  Jakarta   |  Sat, 09/30/2006 9:39 AM

Ridwan Max Sijabat, The Jakarta Post, Jakarta

Lawyers for the Indonesian Labor Exporters Association (Apjati) have filed suit against Manpower and Transmigration Minister Erman Suparno over the appointment of insurance companies to cover workers in overseas jobs.

Lawyer Sangap Sidauruk said Friday that the suit asked the Jakarta Administrative Court to annul two decrees that have drawn strong protests from labor exporters and workers.

They argue the ministerial policies violate laws on labor and insurance, and are overly burdensome for people who want to work abroad.

The first decree appointed seven insurance companies to cover workers in overseas jobs, replacing seven companies and two foundations that had provided a similar program. The second appointed PT Grasia as the sole broker for the seven companies. Grasia has charged Rp 400,000 for the plan from every migrant departing for an overseas position.

""The appointment of the seven insurance companies and the single broker is against Law No. 39/2004 on labor protection and Law No. 10/1992 on commercial insurance, because it amounts to a monopoly. The government should allow all insurance companies registered with the Finance Ministry to compete fairly,"" said Sangap.

He said he has also requested that the Supreme Court review the two decrees. He added that the price for the premium set by Grasia was too high and overburdened workers.

Previously, Halomoan Hutapea of the Asia-Pacific Labor Export Association reported the issuance of the two decrees to the Anti-corruption Commission, saying the ministerial move benefited certain companies.

Minister Erman has repeatedly denied there was any graft involved, saying the labor protection law gives him the authority to regulate the insurance scheme to provide better protection for workers.

""The previously appointed insurance companies and foundations were found ineffective and the new decree aims at reforming the insurance program for workers. The polemic and protests emerged because the two decrees conflict with the interests of labor exporters,"" he said last week.

Many labor exporters are confounders of insurance companies and share in their annual profits.

Manpower and Transmigration Ministry spokesman Ruslan Irianto Simbolon said the labor exporters have the right to bring the issue to court, but they should bear in mind that the government has the authority to regulate labor exports.

""The minister discussed labor protection matters, including the insurance scheme, with the House of Representatives Labor Commission before the two decrees were issued, and the commission understands the reasons for the decrees' issuance,"" he said. He added that the government would abide by the court's decision on the lawsuits.

Many activists have also criticized the government for giving labor exporters ""too many"" roles in the labor export procedure.

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