Labor unions across the country have demanded the government set up a crisis center and provide businesses with loans for severance payments in anticipation of potentially mass layoffs this year as the impacts of the global financial turmoil hit home.
More than 20 unions said the crisis center was urgently needed as a forum for the government, private sector, labor movements and experts to meet and discuss prevention methods ahead of the looming mass layoffs.
"If mass layoffs cannot be avoided, the government must provide loans for businesses to help them provide severance payments to sacked workers. The government can later on ask the companies for the loaned money back," the unions said in a joint statement sent to The Jakarta Post on Friday.
They also urged the government to abolish taxes on severance pay, pension allowance and holiday allowance, arguing those benefits could not be classified as taxable income.
Furthermore, demands were made to lift the low-income tax bracket Rp 1,320,000 monthly to Rp 2,000,000 monthly.
"The government must immediately reduce taxes on imported items as regulated under a Trade Ministry decree in January, not in February as earlier scheduled," the statement said.
The government was urged to pressure industries to cut fuel prices, intensify work training programs for the unemployed across the country and annul the minimum wage joint decree issued by four ministers in late October 2008.
"And we call on all laborers in this country to use their right to vote in the upcoming legislative elections on April 9 to elect members of labor unions regardless of their political parties, as long as they have upheld moral values, are of good quality and are dedicated to the labor movement.
"We will organize the Indonesian Labor Congress ahead of the presidential election in July 2009 to ensure we only vote for candidates who have vision and a mission for the improvement of laborers' and their families' welfare," said the statement
Lawmaker Harry Azhar Azis of the House of Representatives' Commission XI overseeing financial affairs, national development and banking sector said although the establishment of the crisis center is possible, there is currently no legal basis for the loans and for the abolition of taxes for severance pay, pensions and holiday allowances.
"The government has to firstly issue a regulation that enables such policies," said Harry, from the Golkar Party.
