70% increase in minimum wage, 100,000 switched to permanent positions – how did Indonesian labor movement revive?

05/05/2018 - 12:54pm
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Nowadays in Indonesia, workers' protests are concentrated in cities, whereas farmers are fighting against land grab in villages. Indonesian workers face overwhelming violence and brutality from military and mobs in intensity that Hong Kong workers can hardly imagine. But the movement achieved a lot despite heavy pressure: in 2012, after 7 months factory raid, more than 100,000 outsourced workers gained permanent positions in Bekasi industrial area; minimum wage in 15 industrial areas increased by 48% in average after the general strike in 2013. 

Recently, Abu Mufakhir (hereafter Abu), veteran organizer and researcher of Indonesian labor movement, gave a sharing titled 'Indonesian Workers' Struggle in the Post-Dictatorship Era (1998-2015)', in which he illustrated how Indonesian workers' power was strengthened in 20 years' time. Starting with the history of Indonesian labor movement, to the aims, strategy and organizing practices of the movement, Abu’s sharing should be a great reference and inspiration for those who concerned about workers right.

Era of Dictatorship: 30 Years of Labor Movement Repression (1965-1998)
The dictatorship Abu referred to was the reign of Suharto, the second president of Indonesia. In 1965, Suharto seized power after a military coup against the pro-communist then-president Sukarno. Within a year after the coup, 3 millions were killed in Suharto regime's purge of communists and nationalists, according to some independent researches. Suharto's military regime lasted till 1998.

Since 1965, Indonesia labour movement is under military control. Military use the “cooperative body” called BKS BUMIL (Badan Kerdja Sama Buruh Militer/Cooperative Body of Workers and Military). Since 1973, Government only allowed single union named SPSI (Serikat Pekerja Seluruh Indonesia/All Indonesia Trade Union). While the labor law was enacted by military, they also dominated each and every aspect of workers' movement: all labor disputes were “arbitrated” by the military not by tripartite or labour court institution. Their decision depended on their relationship with the companies involved. The military would disperse protesting workers if they were on good terms with the companies, while encouraging workers to strike to threaten the hostile ones. Although a labor court was set up, it did not accept any case between 1974 and 1997, as Abu recalled.

More and more strikes were called since 1990s. Workers tried to organize themselves in the form of 'labor forum' in order to avoid the name 'union’ – because at that time, government only allowed single union. Suppression from the military reached unprecedented intensity. Many workers were imprisoned and killed. The murder of worker leader Marsinah was one of the most infamous incidents. In 1993, 500 watch factory workers struck for pay rise in Porong, East Java. 2 days later, worker delegate Marsinah was kidnapped after initiating a rally. Her body was found in the wild 3 days later. The forensic report showed that Marsinah was tortured and raped. It was believed the military was involved, but the truth is still hidden years after her death.

Post-Dictatorship Era: First Glimpse of Success of Workers Struggle (1998-2015)
After the downfall of Suharto in 1998, a series of political reform loosened restrictions on union movement. In 2000, International Labor Organization’s convention concerning freedom of association was rectified, trade unions sprung up in Indonesia. 80 unions federations were established in only 5 years. By 2016, there were more than 100 federations and 9 confederations of trade unions in the country. Abu pointed out, however, trade unions are scattered over the entire country, partly due to the geographic distance between the islands, which hinders communication among the unions. Apart from that, Indonesians have only little and limited understanding about union, how to organize workers and initiate strikes, under the depoliticizing effect of prolonged dictatorship. At present, less than 16% of formal employees in Indonesia are unionized.

In spite of these impediment, Indonesian labor movement gained momentum in street protests. At least 8367 workers' collective actions took place between 1998 and 2013; excluding the 3 general strikes and May Day rallies, more than 6 millions workers were involved in these actions. Abu deemed workers' protests between 1998 and 2001 as the first wave of workers' actions. While the Asian Financial Crisis caused a wave of factory closure, leading to a 40% drop in workers' real wage, workers' actions at that time were filled with rage and focused on pay rise and the recovery of severance pay. By 2006, large-scale outsourcing of job positions in public sector intensified the fragmentation of employment, sparking off a new wave of movement. Abu found this new wave of actions more appealing to workers. Imbued with music and dance, the marches gave off a more joyous vibe.

In 2012, unions from different factions came together and formed the Indonesian Workers Consultative Assembly (Majelis Permusyawaratan Buruh Indonesia, MPBI), main issues concerned included minimum wage, outsourcing and social security protection. Abu quoted research findings that showed a rising percentage of protests organized by cross trade union alliance from 4.5% to 57% between 2007 and 2013. The increase revealed the growing influence of union confederations, he suggested. MPBI initiated a general strike in 2012. Workers surrounded office of the municipal government, requesting for a rise in minimum wage, while an increase in social security protection was demanded by the workers in a 14-day rally from Surabaya to Jakarta. Enormous achievements were made after numerous rounds of protests. Minimum wage was raised by 48% in 15 most important industrial areas, while employees in Bogor, a city engaged in garment and textile industry, enjoyed a minimum wage increase of 70%. In Cilegon, where chemical petroleum industry is prosperous, workers' wage rose by 68%.

In Bekasi, workers intentionally messed around and played in the factories to fight against outsourcing. Since the city accounted for 40% of the country's total export, the government hesitated to impose violence on workers. Hence, local thugs were hired to do all the dirty works. When coming across anyone on the street wearing union jacket, they would ask the worker to strip and would then burn all his clothes. The workers claimed victory regardless. Permanent positions were offered to 100,000 contractual and outsource workers. No worker was imprisoned or murdered during the protest.

Wage as Pivotal Demand of Movement over Other Issues
From the ruins in the post-dictatorship era to the first glimpse of success today, what characteristics of Indonesian labor movements should be identified? Abu provided his observations to the question. He first revealed that wage was the major demand of Indonesian workers’ protest. Among issues appealed for, wage was apparently the most dominant (769 times), followed by non-labor policies such as gasoline price reduction (48 times), work protection (46 times), freedom of association (41 times) and social security protection (12 times).
 
As for the wage-related demands, minimum wage policy and wage theft were issues most protested against. One of the policies targeted by the workers, as Abu mentioned, was the basket of components of decent life determining the minimum wage rate. The basket had consisted of 47 component since 1986, which significantly limited the wage increase rate. In 2012, thanks to workers’ persistent struggle, the number of factors was raised to 66 components, implying a possibly higher increase rate of minimum wage in the future. Nonetheless, the number of factors were still far less than those suggested by the unions (86 and 110 respectively). Meanwhile, the government also tended to use cheaper products, namely combs and soaps, as indicators.
 
Instead of other labor issues, wage remains the primary focus of Indonesian labor movement, which Abu attributed to the extremely low wages in the country, and to the fact that wage is most easily understood among various workers’ demands and also the easiest to agree upon by consensus between different union. If social security protection is to be discussed, unions can have varied opinion and hence diverse or even contradictory stances, for only few are willing to pay insurance fee for the protection.
 
On the other hand, Abu also spoke of Indonesian workers’ views on their freedom of association and collective bargaining rights. He was under the notion that these two rights are not the main focus of labor movement, for establishing union is relatively simple – according to the trade union regulation, to set-up a new plant level union, it’s only need 10 workers who willing to join the union. Then to set-up federation level union, it’s only needed 4 plant level union, regardless the industrial sector and city. According to trade union law, union busting is criminal act. The problem is that employers’ attempts to disrupt union are hard to prove, whereas government labour departments (especially the monitoring body) often shirk responsibilities, resulting in labor rights being unprotected. In regard to collective bargaining rights, coverage of collective agreement in the entire country hovers below 1%. Terms of these agreements, mostly signed by the ‘yellow’ unions, are even worse than those stipulated by labour law. Due to its ineffectiveness, workers pay only little attention to collective bargaining.
 
Ineffective Institutional Channels urge Workers to Take to the Streets
As for the strategy of labor movement, Abu suggested that workers tend to launch street actions to call for government to make changes. According to statistics, among the workers’ protests in 2012, 527 took place outside government buildings and parliament, compared with 370 in workplaces, while only 63 and 56 were staged respectively on the main roads and at city landmarks.
 
Defending labor rights through institutional channels remains unfruitful in Indonesia, according to Abu. Filing lawsuits is arduous and grueling for workers - since labor court is only located capital city of province, a worker may need to travel 6 hours from their home to the labour court in the province capital city, just to complete the court procedure that lasts only 15 minutes. In view of the futility of institutional channels, workers’ street protests are deemed justifiable to a certain extent.
 
Protest against the Minimum Wage Council is considered a typical example of street protests amidst numerous demonstrations. The Minimum Wage Council in Indonesia is comprised of representative from union (25% seat), -business association (25% seat) and  government representative from labour department (50% seat). As representatives of trade union and business association both have unshakeable stances, workers’ strategy is to lobby the officials to accept their suggestions. Every time the minimum wage council begins its study on minimum wage, workers also conduct their own research to contend with the government’s report. Meanwhile, given that only price changes are taken into consideration by the minimum wage council the increase rate of minimum wage does not exceed 10%, which forces workers to go on strike to demand for a higher increase rate.

 
General strike in 2013: No more low wage, End outsourcing, Social protection for the people

Organizers turn conservative after initial success
While discussing problems of organizing workers, Abu shared his rich observations. First, he pinpointed the countless segments and conflicts among workers. As the protection scope of minimum wage in Indonesia only includes formal employees, workers working in farms and villages fail to benefit from the policy, resulting in their continual exploitation. In the meantime, the fight for minimum wage adjustment has triggered discontent from the tertiary sector workers (especially the white-collars). Abu revealed the white-collar workers tend to agree that the other workers, for their low education level, should not enjoy a wage increase of more than 10%, while some oppose to wage increase for their counterparts in other sectors, for fear that raising minimum wage would lead to a rise in inflation.
 
Yet, Abu considered the conservative attitude of some union organizers as the crux of the matter. He further illustrated how a slogan of the Indonesian labor movement ‘from trade union, by trade union, for trade union’ has in fact hindered union from building connections with other sectors such as students and women movement groups, especially when unions lack sufficient understanding of gender issues. Most leading roles in unions are currently male-dominated. Despite the fact that some of these unions have set up women departments, women members are only in charge social gathering, service and fundraising. While unions are concerned with women workers’ pay and working conditions, workers’ problems at home are often neglected. Once a female worker sought help for domestic violence from a union officer, she was rejected simply because the officer perceived it as a personal problem beyond the union’s responsibility.
 
A few unions in Indonesia have made more progressive attempts, though. The Federation of Indonesia Workers Union (Gabungan Serikat Buruh Indonesia, GSBI) has commenced a family organizing project to further organize workers’ family members. The ideal of project is to organize ‘outside the factory’. In order to involve women workers in the union, organizers try to seek support from their family members by means of doing home visits and explaining about the union to the families during visits. In a protest against the unreasonable dismissal by an Adidas subcontractor, the union successfully persuaded some female workers’ husbands to shift stance and support the protest, some husbands even joined their wives in the demonstration.
 
Conclusion
Throughout the whole sharing session, Abu mentioned several times that workers in Indonesia are still facing great difficulties as the country's political atmosphere remains appalling. Despite the fall of Suharto in 1998 and military's loss of voting right in the parliament, all political parties in Indonesia are still firmly grasped by military with strong financial capacity. Although workers claimed victory in the 2012 general strike, their wages are still extremely low, poverty remains a major issue in the country.
 
What is encouraging is perhaps the workers' invention of effective means for the movement and some organizers' further exploration of ways to expand workers' organizations in spite of the precarious conditions. These means can serve to inspire discussions even for us in Hong Kong. For instance, the announcement of statutory minimum wage adjustment by the Minimum Wage Commission in Hong Kong never receives much attention, why is wage never given the emphasis in Hong Kong workers' movement? Institutional channels for defending workers' rights in Hong Kong (namely Labor Department and the Labor Tribunal) are widely criticized, but how should its use and problems be evaluated and reviewed? Similar to the dictatorship era in Indonesia, Hong Kong's colonial history has also left a legacy of depoliticization to society, how should we understand such historical context? These questions await further exploration and discussion.

 

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