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Improve social dialogue in industrial relations
The current conflict reflects the character of industrial relations in Indonesia. Industrial conflicts are inseparable from the history of labor policies, which has been pro-investor since the New Order. Industrial conflicts marked by union strikes and demonstrations show that social dialogue in industrial relations has not become a tool for creating industrial justice.
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Workers are marching during the annual May Day rally in Jakarta on May 1, 2019. (JP/Donny Fernando)
T
he plan to revise Manpower Law No. 13/2003 has caused a sharp division between trade unions on one side, and employers as well as the government on the other. The contentious issues, as expected, revolve around workers’ protection. The unions reject the planned revision while the government-employer alliance deems the revision necessary, because the law protects workers too much to the detriment of companies.
The Indonesian Employers Association (Apindo), which initiated the plan, has proposed revisions that would simplify the process of increasing minimum wages and decreasing severance pay, provide more opportunity for flexible employment through outsourced labor and also simplify layoffs.
The unions unanimously rejected the Apindo proposal, arguing that even though the law regulated minimum wage increases, the state had taken over the process to nullify the need for negotiation between trade unions and employers. They also said that employers rarely implemented the regulations on severance pay, while the provisions on flexible employment through outsourcing and contracts, as well as layoffs, were widely violated.
The conflict is a repetition of 2006 and 2016, when similarly controversial plans to revise the Manpower Law were canceled. This time, it is very likely that the revisions will be implemented, given the characteristics of newly reelected President Joko “Jokowi” Widodo, a former businessman who is known as a man of action and pro-investment.
The current conflict reflects the character of industrial relations in Indonesia. Industrial conflicts are inseparable from the history of labor policies, which has been pro-investor since the New Order. Industrial conflicts marked by union strikes and demonstrations show that social dialogue in industrial relations has not become a tool for creating industrial justice.
Social dialogue as defined by the International Labor Organization (ILO) refers to “all types of negotiation, consultation or simply exchange of information between, or among, representatives of governments, employers and workers, on issues of common interest relating to economic and social policy”.
Social dialogue is the best mechanism for promoting better living and working conditions, as well as social justice. It is an instrument, a tool of good governance and is relevant to any efforts to make the economy perform better and more competitive, and to make society more stable and more equitable.
