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fter two years of tough negotiations, involving the top leaders of both countries, Indonesia and Malaysia eventually overcame the protracted deadlock on the sending of unskilled Indonesian workers to Malaysia.

Indonesian Manpower and Transmigration Minister Muhaimin Iskandar and his Malaysian counterpart, S. Subramaniam, signed a new memorandum of understanding on informal sector workers here on Monday that effectively ended a June 2009 unilateral moratorium by Indonesia on sending workers.

A previous MoU was signed in 2006 but Indonesia complained the document favored only the Malaysian side at the cost of Indonesian workers.

Indonesia took the drastic boycott decision following widely reported abuse of Indonesian workers in the neighboring country where many are undocumented and work in palm oil plantations, construction and as domestic workers. Malaysia attempted to reduce its dependence on foreign workers, including from Indonesia, its largest imported labor source, saying their presence created social and criminal problems.

“With the signing of the new MoU, the moratorium is lifted and as of tomorrow [Tuesday], workers are allowed to go to Malaysia to work under new labor contracts,” Muhaimin said after the signing ceremony.

Despite the moratorium, Indonesians continued to flock to Malaysia and become illegal workers because of the labor and worker protection situation was worse here. There are an estimated 2 million Indonesians currently working in Malaysia.

Malaysia remains a major destination for Indonesian workers, alongside Saudi Arabia and other Middle East countries.

Muhaimin, who also chairs the National Awakening Party (PKB), said Indonesia was able to win four of its key demands. With the new deal, Indonesian workers have the right to keep their passports and other official documents.

So far, employers are entitled to keep the official documents to force workers to remain with them. However, the document seizure is often a means of keeping the workers hostage.

The second concession won was that employers were obliged to provide one day off per week or to pay financial compensation to workers who had to work on their day off.

The next key demand in new agreement was that a recruitment fee was established by the two countries to counter previous practices where private sector firms fully controlled the fees.

The workers will also have the right to communicate with relatives and Indonesian authorities, including the embassy in Kuala Lumpur.

“If Indonesian citizens come to work in Malaysia illegally, the Malaysian government cannot benefit and cannot provide maximum protection because the workers will certainly be detained and fined,” Subramaniam said, referring to the presence of illegal workers.

Muhaimin acknowledged that the two governments were still not able to reach a deal on Indonesia’s demands for a minimum wage. Malaysia insists remuneration should be based on market mechanisms.

Indonesian ambassador to Malaysia Da’i Bachtiar hailed the new labor agreement as the key guide for both countries to protect Indonesian workers. He said the new deal gave workers legal certainty on their rights.