Notes: trade union rights in Indonesia

Freedom of association

Trade Union/Labour Union Act No. 21/2000, the Act guarantees:

  1. workers’ rights to establish and become members of unions;
  2. unions’ rights to function in order to protect, defend and improve the welfare of workers and their families, and;
  3. the protection for workers against acts of anti-union discrimination and interference.

The Trade Union/Labour Union Act allows workers in the workplace to organize (article 5 (1)), but trade unions have to register with the ministry of manpower in order to be recognized (article 18 (1). At least ten members are required to form a union. Trade unions can be formed across sectors and nationwide (private sector workers).

According to this Act, civil servants have the right to organize but this right is restricted, article 44 proclaims that civil servants shall enjoy freedom of association and that the implementation of this right shall be regulated in a separate Act. Such an Act has not been adopted yet. Therefore, substantively, this Act is discriminative because there is differentiation in regulation on right to organize and freedom of association toward the Indonesian civil servant. Indonesia has ratified ILO Convention 87/1948 concerning Freedom of Association and the Protection to Organize. Some argued that civil servants could use the convention as referent; however article’s 44 of the Trade Union/Labour Union Act No. 21/2000 obstructing civil servants to enjoy the rights in practice. 

Although, the term of worker/labourer, under the Act No. 21/2000, is defined as any person who works for a wage or other form of remunerative exchange, but in practice for those who work in the precarious employment (outsourcing and atypical employment contracts) and informal workers have constraints on the exercise on these rights.

  • Precarious employment – anti union act is rampant: though no exclusion in the law for workers in the precarious employment to join union but threat on losing job hamper the workers to organise themselves
  • Informal workers: the informal economy defined as a broad range of activities not fitting into the regulated economic framework, but exists all over Indonesia. It covers everything from hawkers selling personal services on the streets or to private households to family farmers, casual agricultural labourers, domestic workers and unregistered contract labour. Though no legal impediments for informal workers to join the union but the lack of formal employment relationship excludes them from the rights to form and join union.

Trend of union-busting: By law, employers are not supposed to intimidate, coerce, or fire employees for exercising their democratic rights to form unions. The provisions under the Trade Union Act No. 21/2000 clearly give legitimacy and protection for workers the right to organise (Article 28) and provide sanction for those who violated the law (Article 42), however in fact anti-union discrimination rapidly increase in the workplace not to stop workers on joining union but employer financing and supporting for the establishment of yellow union. The establishment of yellow unions is a tactic deployed by the companies to prevent the emergence of bona fide workers representation. Meanwhile in the public sector, the companies engaged union-busting to overcome union opposition to the privatisation and to eliminate any challenge to complete management control in the workplace.

On 4 October 2011, the management of PT.PLN instructed security personnel to enter the offices of the national secretariat of SP PLN and to forcibly eject the occupants and confiscate their equipment and documents. (Photo left: one of the PLN Company director supervised the office removal).

The general secretary (former) of PLN union (left) busy saving important document during the force removal of the union office by the management, meanwhile (right) the union president waited at police station for investigation after reporting the case. Source of photos: http://www.flickr.com/photos/68549860@N04/

PLN union is a union for workers who work for Indonesia electricity run state own enterprise. The PLN Union was established in 1999 after separating from the KORPRI, or Republic of Indonesia Civil Servants Corps, and has a membership of 48,000 spread all around Indonesia. PLN union is affiliated to Public Services International (PSI – www.world-psi.org).  Almost immediately, the new union of PLN was faced with various workplace issues, particularly when the government introduced a new legislation, Law No. 20/2002, to liberalize electricity market in 2002, and thereby make it open for foreign investments. The union challenged the law and filling judicial review to the Constitutional Court (Mahkamah Konstitusi). Finally, in December 2004, the Union won a landmark decision in the Constitutional Court, which cancelled the Law No. 20/2002 on Electricity. But this cancelation was not stopping the government to enact new law No. 30/2009 on electricity.  Beside challenged the law, the PLN Union had set out strategic campaign and developed union resistance campaign that includes: building alliance of coalition nationally and internationally, organizing and mobilizing members and local actors for advocacy, raising campaign fund, filing judicial review of the law, staging mass rallies, publishing campaign materials, and threatening to switch off the electricity power. Indeed the union open opposition against privatisation has resulted on management anti-union tactics, interfering in the activities of the union: (1) refusing to recognise the legitimacy of SP PLN, and its elected leadership; (2) concluding a collective bargaining agreement (CBA) with this “yellow” union, despite the fact that negotiations on the CBA between PT.PLN and SP PLN were still open and that the existing CBA should have remained in force at least until 23 November 2010 (and valid for extension until both parties agreed to renegotiate); (3) preventing members of SP PLN from paying union dues and withdrawing check-off facilities, unilaterally dismissing the union committees and generally intimidating and harassing SP PLN members, preventing them from engaging freely in union activities; etc.

Unions Membership

Based on the verification of union membership by MOMT (2012): 5 Confederations, 91 Federations, 437 plant level unions (private sector) and 170 state own enterprises workers unions with all total workers being members of the unions: 3,414,455

Though the source based on the information provided by Ministry of Manpower and Transmigration Republic of Indonesia (MOMT), however the data could not provide the actual number of total membership as no complete verification have been made by MOMT since Manpower Regulation (Permenaker) No. PER.06/MEN/2005 enacted. Labour unions has been urged the government to complete union verification process, despite acknowledgment of freedom of association and rights to organise, unclear labour union representative in some extend doubt the effectiveness of social and tripartite dialogue and to perceive workers in collective bargaining with their employer.

One of the obstacles to do verification process is regional autonomy. Regional autonomy has hampered on law enforcement in Indonesia.

After its establishment, a union, federation or confederation must notify the local government agency responsible for manpower affairs. Due to local government lack of funding and skills the unions’ verification process is delayed.

Right to strike

Definition of strike according to Law No. 13/2003 concerning Manpower: A strike is a collective action of workers/labourers, which is planned and carried out by a trade/labour union to stop or slower work.

Strike is legal and being recognised as a fundamental right of workers/labourers and trade/labour unions (Article 137 of the Law No. 13/2000 concerning Manpower) BUT the strike shall be staged legally, orderly and peacefully as a result of failed negotiation.

Under the law legally, orderly and peacefully strike means:

  1. Within a period of no less than 7 (seven) days prior to the actual realization of a strike, workers/ labourers and trade/ labour unions intending to stage a strike are under an obligation to give a written notification of the intention to the entrepreneur and the local government agency responsible for manpower affairs (Article 140 (1))
  2. Following article 140 (1), the notification of strike should be informed and at least contains of (article 140 (2)): a. the time (day, date and the hour) at which they will start and end the strike; b. the venue of the strike; c. their reasons for the strike; and d. the signatures of the chairperson and secretary of the striking union and/or the signature of each of the chairpersons and secretaries of the unions participating in the strike, who shall be held responsible for the strike
  3. Strike are banned in enterprises that serve the public interest and/or enterprises whose type of activities, when interrupted by a strike, will lead to endanger the safety of human life (Article 139)

Whilst the general interpretation of peacefully and orderly means that the strike must not disrupt security and public order and/or threaten the life safety and property of the enterprises, entrepreneur, other people or other members of the general public. Through this interpretation therefore gives the employers unilateral power to stop a strike and order the police that the workers violate and disturb the public order.

In 2003, Minister of Manpower and Transmigration released Ministerial Decision No. 232/MEN/2003 to stipulate the legal consequences of illegal strike. Thus right to strike in Indonesia, in law and in practice, is nearly impossible to exercise

Legal counter actions taken by the employer: Against the legal strike organised by the union the employer can legally takelockout action. As stated in the (article 146, Act No.13 of 2003) that lockout is afundamental right of entrepreneurs to prevent their workforce either in part or inwhole from performing work as a result from failed negotiation.

Angkasa Pura 1 Union on strike in May 2008 (photo: left) and Mr. Arif Islam, union leader of Angkasa Pura 1 Union (photo: right). The management dismissed him after lead the members to take part on the union strike on 7-8 May 2008 (Photos by Indah Budiarti)

Angkasa Pura 1 Union on strike in May 2008 (right). Angkasa Pura 1 rally for anti-union busting and to reinstate of Mr. Arif Islam and to respect for workers’ rights (left) – photos by Angkasa Pura 1 Union.

 In May 2008, employees of Angkasa Pura I held massive strikes in several Indonesian airports demanding allowances and leave rights which were already agreed in the collective agreement. In spite of several attempts by the union to resolve the dispute through negotiation and mediation, management continued to refuse to implement the collective bargaining agreement in full. Eight union leaders of the Angkasa Pura 1 Union were victimized after their participation in strike action in May 2008. Following PSI global appeals, seven suspended leaders were returned to work, but the chair of the union, Arif Islam, has still not been reinstated. An ILO complaint was lodged in this case. In November 2010, the Committee on Freedom of Association reiterated its recommendations in relation to the complaint, and requested the government take steps to ensure that union and workers’ rights are fully restored (Please click here to read the report). One of the Committee’s recommendations was that the government ensure that Mr. Arif Islam was reinstated in the position he occupied in the company PT (Persero) Angkasa Pura 1 at the time of dismissal, with compensation for lost wages and benefits. However, the recommendations had not been implemented and the union is continuing with its campaign.About Angkasa Pura 1 union: Serikat Pekerja Angkasa Pura 1 (SP Angkasa Pura 1) or State Owned Enterprise Airport Services and Business Workers Union) – for Eastern and Middle part of Indonesia – where the workplace is located in 13 (thirteen) cities, in which 94% of the workforce is organised, the remaining workforce is security and police or army.The union was established in 1999 after leaving KORPRI (Indonesian Civil Servants Corp is the only organisation for civil servants, the membership is automatic, previously the membership also employees who work in the national state own enterprises. However in 1999 Congress KORPRI’s amended its constitution and allows employees to state own enterprises to be or not to be members of KORPRI) and represents 3400 members of the airports in the middle and east parts of Indonesia. However due to industrial dispute in 2006, the management supported on establishment of yellow union that remain the union just only have estimated 1200 members. Angkasa Pura 1 union is affiliated to Public Services International (www.world-psi.org)

The Jakarta Water Union (SP PDAM Jakarta) and their members staged two days of demonstrations 18 and 19 July 2010 in Jakarta to protest the refusal of employers – PT. Aetra and PT. PAM Lyonnaise Jaya – to grant wage increases and improve working conditions. The water supply service of Jakarta, capital city of Indonesia, was privatised in 1998. Privatisation has led to a deterioration of working conditions and water quality. The workers have not received a salary increase since 2003. The basic wage is USD 140 for workers with 25 – 32 years seniority. This is a serial protest the union has conducted since 2010. In good faith, the union has attempted to begin negotiations several times but the efforts have failed to result in meaningful talks with both PT Aetra and PT Palyja. (Photos by Indah Budiarti (left) and SP PDAM Jakarta (right)
SP PDAM Jakarta is affiliated to Public Services International (www.world-psi.org)

Though there are restrictions in exercising right to strike, somehow workers and trade unions manage to organise rally and demonstration:

  1. Massive Labor Protests Paralyze Parts of Jakarta – by Jakarta Post (July 12, 2012)
  2. Workers demanded a minimum wage increase in Bekasi and clocked off a major toll road – by Jakarta Post (February 07 2012)
  3. Bekasi workers block Cikarang toll road – by Jakarta Post (January 27 2012)
  4. Indonesian Postal Service Employees Launch 3-Day Strike – by Jakarta Globe (June 28, 2012)
  5. Thousands workers show off against fuel price hike – by Jakarta Post (March 30 2012)

Although the first of May is not an official holiday in Indonesia, many workers with their unions poured into the main street of Jakarta and other cities to celebrate May Day Rally this year amid a strict security from police and security force. The media reported some 161,000 workers took part in largely peaceful May Day rallies across Indonesia (Jakarta Globe).

President of three confederations: KSPI, KSBSI and KSPI lead the May Day Rally (left). Workers holding the May Day banner: stop outsourcing, decent wage and stop cheap labour policy, social security scheme for all workers (right). Photos by Indah Budiarti

Source: The Directorate of Industrial Relations of the Ministry of Manpower and Transmigration

Advocacy

The nature of industrial relations manifested under the principle of Hubungan Industrial Pancasila (HIP) that follows the five principles of State ideology Pancasila and 1945 Constitution (UUD 1945). The principle of HIP’s has been regulated in Minister of Manpower Decree No. Kep: 645/MEN/1985, the regulation states that any and every dispute between worker/s and management shall be solved through consultation and consensus. Moreover, there is another regulation issued by the ministry which is Minister Regulation No. 4/MEN/1986. This regulation allows security forces (police and armed forces) to be involved in solving disputes between worker/s and their employer.

Industrial relations under the Law No. 13/2003 on the Article 102 (2) stated that “in conducting industrial relationship, workers/labourers and their labour union/trade unions shall perform the function of performing their jobs/work as obliged, working order to ensure production, channelling their aspirations democratically, enhancing their skills and expertise and helping promote the business of the enterprise and fight for the welfare of their members and the families”, Paragraph (3) states “in conducting industrial relationship, entrepreneur and their organizations shall perform the function of creating partnership”. The articles hope for making it possible for business to develop, employment to diverse, and welfare for workers/labourers in transparent and democratic ways and in manners that uphold justice.

Based on chapter XI of the Manpower Law No. 13/2003, industrial relations are divided into four main things, which are: (1) working conditions; (2) the existence of union and its functions; (3) company regulations or collective bargaining agreement; and (4) industrial dispute and its resolution. Nevertheless, in practice, there are several factors influencing fairness in implementation of such industrial relation, especially as Indonesia currently moves into transition times from centralized system to decentralized one which requires industrial relation to be determined by negotiation among union and employer. This situation obviously has impact on dynamic of employees-employer relation.

Law No. 2/2004 on Resolution of Industrial Relation Disputes:  the law is aimed at providing legal assurance for solving industrial disputes, through out of court and/or inside the court settlement. The court for settling the disputes shall be under district-level court. The law defines industrial dispute as “dissenting opinion causing disagreement between employer or association of employers and worker/labour as a result of dispute over rights, disharmonious interests, objection against dismissal and inter-union disagreement within a company”.

  • Four types of disputes: (1) rights disputes; (2)interest disputes; (3) employment termination disputes, and; (4) disputes among trade unions
  • The law emphasized the importance of bipartite negotiation to resolve the disputes before be settled in the industrial court.
  • However, the recommendation does not block the parties to resolve the disputes  or conflicts directly through the industrial court
  • The proceedings at the Industrial Relations Court theoretically should not exceed 50 working days from the first hearing
  • Appeal to the supreme court: not all industrial relations dispute cases decided by the district court can be appealed to the supreme court, this is to respect that the decision settlement is final and binding of each parties

Collective bargaining

Indonesian labour law currently provides some of the strongest guarantees for collective labour rights

  • Law on collective bargaining agreement (CBA) is stipulated on Section Seven Article 116 to Article 135 of the Law No. 13 concerning Manpower
  • Law No. 21/2000 concerning trade union/labour union
  • Law No. 22/2004 on Resolution of Industrial Relation Disputes

To acquire bargaining rights in Indonesia, a union must represent a majority of workers in the bargaining unit (the union whose membership totals more than 50% of the workforce can negotiate the collective agreement). Only one collective bargain may be concluded in a workplace, and the terms of the agreement apply to all workers, regardless of whether they belong to a union (Article 120 (1) and (2) of the Law No. 13/2003).

Multiple unions in single workplace is allowed by the law, therefore according above article 120 (1) and (2) of the Law No. 13/2003, the employer could easy violate by doing union busting and supporting for the establishment of yellow union to avoid negotiation with genuine union.

Due to above challenge, therefore in 2010 Bank Central Asia Workers Union (SP BCA) filed case against the article 120 (1) and (2) of the Law No. 13/2003 for reviewed by the Indonesia Constitutional Court (MK). In its decision, the Constitutional Court decrees that “Article 120 (1) and (2) of Law No. 13/2003 on Manpower is against Constitution 1945.” 

  • Article 120 (1) states, “If there are more than 1 (one) unions in a company, union which is right to represent workers in negotiation with the employer shall be that of with memberships of 50% (fifty percent) of all workers within the company.” According to the Court, the article has three defects. First, the article annuls rights of the union to fight for the rights of workers who are not in the 50% membership. Second, it brings about unfair and injustice treatments among the unions. And, third, it abolishes rights for legal protection and just treatment within a company of the workers who are not in the majority union. Therefore, with the cancellation of verses (1) and (2) of Article 120, verse (3) of the article also amends. Originally, Verse 3 of Article 120 states “Shall the provisions as stated in verse (1) or verse (2) are failed to meet, the unions should establish a negotiation team of which members are proportionally determined based on the number of memberships of each union.” The amended Verse 3 states “The unions establish a negotiation team of which members are proportionally determined based on the number  of memberships of each union.” And should be read “In the event there are more than one unions within a company, the number of unions which are right to represent workers in a negotiation with the employer/management within a company is maximally three unions or amalgamation of unions with minimal memberships is 10% (ten percent) of all workers within a company.” 

Validity of the collective labour agreement is for 2 (two) years (Article 123) and the effectiveness of the collective agreement may be extended for no longer than 1 (one) year based on written agreement between the entrepreneur and the trade/labour unions. In addition, the negotiation for the next collective labour agreement may be started as early as 3 (three) month prior to the expiration of the existing collective labour agreement.

Public employees in national and local government cannot take part in the free collective bargaining since they are obligated to join KORPRI (Indonesian Civil Servants Corp). Salary and welfares of the civil servants is determined by the government without collective bargaining

Law in practice53 Nestle Panjang workers has been fired due to fighting for the right to negotiate the terms and conditions of employment at the plant: http://www.iufdocuments.org/www/documents/nespressure_indonesia_and_pakistan_EN.pdfAngkasa Pura 1 management violated the collective bargaining. The union attempted numerous efforts to resolve the dispute through negotiation, including mediation, but the management refused to implement the Collective Bargaining Agreement in full. Furthermore, the management has placed increasingly tighter restrictions on the union’s activity, intimidating and threatening union activists, victimised union leaders (suspended and fired) 

Organising

Union legally exists and recognise in Indonesia, according to Law No. 21/2000 concerning Trade Union/Labour Union  “A trade union/ labor union is formed by at least 10 (ten) workers/laborers (Article 5 (2))”

Being member and union leaders are not threatened as in other countries in the region. This is the generation of free, independent and democratic trade union after Soeharto’s dictatorship fall in 1998, so the movement can draw upon other countries “lessons-learned.”

Beside that protection and right to organise being regulated on the Law No. 21/2000 Article (2): Everybody is prohibited from preventing or forcing a worker/ labourer from forming or not forming a trade union/ labour union, becoming union official or not becoming union official, becoming union member or not becoming union member and or carrying out or not carrying out trade/labour union activities by:

  1. Terminating his employment, temporarily suspending his employment, demoting him, or transferring him to another post, another division or another place in order to discourage or prevent him from carrying out union activities or make such activities virtually impossible
  2. Not paying or reducing the amount of the worker/ labourer’s wage;
  3. Intimidating him or subjecting him to any other forms of intimidation;
  4. Campaigning against the establishment of trade unions/ labour unions

And above article related to article 43 (1) Everybody who bars or forces workers/labourers as referred to under Article 28 is subjected to a sentence of at least 1 (one) year and no longer than 5 (five) years in prison and or a fine of at least Rp100,000,000 (one hundred million Rupiahs) and no more than Rp500,000,000 (five hundred million Rupiahs); (2) The criminal act as referred to under subsection (1) is a, grave criminal offense.

However, there are some factors hindering workers from organizing:

  • Knowledge imbalance among committees and members; there is a sharp gap between “leaders” of labour movement and members of labour unions in terms of educational background and experiences in which this gap reflects in more general a social condition within Indonesian. This situation is enough to describe differences between white collar and blue collar workers. Apart from this, labour movement still inherits old paradigm because some senior figures in labour movement keep on sitting in union leaderships.
  • Related challenge faced by Indonesia unions is a centralized power and facilities at national level (Jakarta). This results from lacks of funds to support sufficient facilities at branch level. Knowledge, facility, and power centralization at national level has caused an oligarchy within union organs. This trend is strengthened by lack of interface points for “professional” activists (fulltime unionist) who have fully left their factories and ordinary members who are still fighting for meeting their ends or finding a leisure time to meet and share their experiences.
  • Indonesia unions tend to use services organizing approaches because of knowledge and experience imbalances among union leaders and members. The approaches is also preferred to because of labour movement experiences under New Regime Order during which labour had been object of either their official unions or some non-government organizations providing services for the labours.
  • Insufficient of commitment and time limitation in member side have also become a big challenge in Indonesia. Because of demands to work overtime experienced by some workers at several sectors or of inadequate working conditions, especially within manufacture sectors, only a small portion of labour is having opportunities to participate in the organization activities. Those who are able to participate more than often have to face the reality that they are rarely having access to decent facilities for conducting their activities. They have to satisfy with facilities provided by the company (this is only for strong unions which are within companies) or by other outsiders, non-governmental organizations for example. The consequence, even though a union is established, only few activists usually are willing to sacrifice their time and efforts to participate in organization life, something which in the end perpetuates power oligarchy in union.
  • Under-utilizing of communication technology advancement. Even though majority of workers and union leaders has cellular phone and are possible to actively access internet, the communication keeps on one-way and is not actively used for organizing programs.
  • The informal sector represents an important part of Indonesia economy and certainly of the labour market in many countries, especially developing countries, and thus plays a major role in employment creation, production and income generation. However, the informal sector represents the situation of absence of state policy to regulate appropriate policy. Therefore, the workers in informal sector are neglected or marginalized from the laws and provisions that cover protection and rights at works (Up to February 2012, out of 120.4 million Indonesian workforces, 112.8 million of them are absorbed into labour market. From the figure, 42.1 million workers (37.29 percent) are in formal sector while the remaining 70.7 million workers (62.71) work in informal activities (BPS, 2012).

References

  1. Workers/Labor union act of Indonesia (Act No. 21/2000): user guide
  2. Trade Union/Labour Union Act No. 21/2000
  3. Law No. 13/2003 concerning Manpower
  4. Labour regulations of Indonesia: Act 1/2000, Act 13/2003, Act 2/2004 (In English and Bahasa Indonesia)

  5. Law No. 2/2004 on Resolution of Industrial Relation Disputes
  6. Indonesia – Basic laws
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