President Susilo Bambang Yu-dhoyono has taken a firm stand amid demands from labor unionists to end the international perception that Indonesia is a haven for investors wanting to tap pools of cheap workers.
On the heels of recent rallies by unionists that often ended in violence, Yudhoyono said on Thursday that the government’s stance over labor welfare was in line with the workers’ demands.
“It is our moral obligation to fight for it. The era of cheap labor and injustice is now over,” said Yudhoyono in a speech before governors, regents, mayors, police chiefs and regional military commanders.
Yudhoyono argued that labor rallies and strikes would stop if businesses were more committed to improving the welfare of their workers.
In the past two months, workers have staged rallies demanding an increase in regional minimum wages by an average of more than 30 percent for next year, and for companies to be given limits on the amount of contract workers they can hire from third parties under the outsourcing scheme.
The government has bowed to union pressure by introducing a decree that limits the outsourcing scheme. Several local administrations have also agreed to excessively raise next year’s minimum wages. The Jakarta administration, for example, has decided to raise the minimum wage by 44 percent, far higher than the 25 percent demanded by workers’ union.
Apart from supporting better welfare, Yudhoyono also expected workers to end their violent rallies.
“We cannot tolerate violence, sweepings or disturbances in the production process,” he said.
“I’ve always demanded that the police prevent such violence. The police should not let the perpetrators get away with these crimes.”
Yudhoyono also urged businesses that fell victim to extortion by officials, an act which may reduce the ability to pay higher worker wages, to send their complaints directly to him via postal box 9946.
In a separate event, Coordinating Economic Minister Hatta Rajasa said that there should be a balanced relationship between firms and their workers.
“We should also take sides with businesses. Companies unable to comply with the minimum wage increases should immediately file a report with the government to demand a wage freeze. We will definitely facilitate them,” said Hatta.
Businesses have voiced concerns that the recent sprawling disputes with workers would send jitters to potential investors and worsen the already high unemployment rate.
According to the Central Statistics Agency (BPS), around 41.4 million people, or 35 percent of the 118 million workforce, are categorized as open or half-unemployed workers. (mar/riz)