21 May, 2014Charismatic Indonesian trade union leader Said Iqbal is the epitome of the dynamism his trade union confederation, the KSPI, has shown in the last few years. Faced with problems such as outsourcing and a minimum wage that is too low, Said Iqbal is committed to fight for change.
Text: Petra Brännmark
Jakarta, February 2014. Members of the KSPI come out in force to protest against broken promises from the government. Although the Ministry of Labour passed a decree in 2013 increasing the minimum wage it has not yet resulted in a significant hike.
The raise is irrational and not realistic, as it will not cover living costs,
says Said Iqbal, president of IndustriALL Global Union affiliate FSPMI as well as the Indonesian Trade Union Confederation (KSPI)
The minimum wage must be raised to a living wage and all workers must benefit from social security.
IndustriALL has 12 affiliates in Indonesia, with a total of around 1.3 million members. The Federation of Indonesian Metal Workers’ Union (FSPMI) has around 220,000 members.
Trade union action in Indonesia
There are six trade union confederations in Indonesia, of which the KSPI is one. Together, they have around 4 million members.
Indonesia is a country with 259 million inhabitants spread over more than 18,000 islands. The young democracy has no strong trade union tradition, and yet the KSPI’s members are strongly committed to the key issues they are fighting for.
Said Iqbal explains that as trade unionists, they fight for predominately three things: the end of the low wages system, social protection, meaning social security for all workers, and against outsourcing.
We struggle for a reform of the social security system, with universal coverage of the health insurance and a mandatory pension fund for formal workers. We fight against a low wage policy, and want a decent wage and a sectorial wage. And then there is the neverending fight against precarious work. We want a change in the employment status, and importantly to change the regulation for outsourcing.
There is a clear strategy and method behind the work; from concept to lobby to action. After agreeing on a concept, trade unionists discuss with stakeholders who range from the political sphere to non-governmental organizations (NGOs). Both traditional media and social media are used, with a heavy presence on Facebook and various mailing lists. And then comes the action.
Huge demonstrations, with numbers of participants unionists can only dream of in other parts of the world are not uncommon in Indonesia. The May Day Rally in 2013 saw as many as 500,000 workers marching side by side in all regions in Indonesia. In the capital Jakarta around 135,000 rallied in front of the presidential palace.
These marches and campaigns are important to get the support of the people
When comparing the minimum wage in Asia, Indonesia with its US$ 210 per month in the biggest production areas, lags behind China, Thailand and the Philippines. And in Taiwan, minimum wages are more than three times higher.
Said Iqbal says that through workers’ mobilization the minimum wage has increased with on average 40 per cent in 2013 and 20 per cent in 2014. But it is simply not enough.
The main problem is that the minimum wage in Indonesia is far from covering the basic living need. For a worker on minimum wage, he or she will only be paid to cover 82,29 per cent of their needs.
We must introduce a compulsory wage scale for employees who have been working for more than one year. Wages above the minimum must be negotiated. There must be government regulations on minimum wage. Companies that pay below the minimum wage must be monitored.
Why does the Indonesian social security need to be reformed?
More than 150 million Indonesians have no social security cover. Parliament passed a bill on universal health insurance meant to apply to all citizens as of January 2014. But the government is being very slow in implementing it, and for millions of workers a proper health insurance has yet to materialize.
The existing coverage is discriminative, limited and profit oriented. The tripartite body was excluded in drafting policies and decisions on the implementation of social security,
says Said Iqbal.
Now there are increased concerns to secure the pension reform agreed to enter into force from 1 July 2015.
Increased social security will help people move from the informal to formal sector. Employers’ attempts to draw back already adopted reforms are a threat to social peace and Indonesia’s path towards prosperity for all citizens.
Conditions for outsourced workers in Indonesia are tough. There is no social security, workers are not covered by collective bargaining agreements, and union busting is common. Indonesian labour law states that outsourced workers should not be placed in core production business, which they often are.
We ran an intensive, large-scale campaign on outsourcing, including both mass rallies and intense lobbying,
says Said Iqbal.
The campaign resulted in new legislation on outsourcing enacted on 21 November 2013.
The result of this intensive campaign is a new set of regulations issued by the labour minister on outsourcing practices. In state owned enterprises, 16 million workers enjoyed a change of status from outsourced workers to permanent and direct contract workers. The new regulations also call for equal wages between permanent, contract and outsourced workers.
What does the future hold?
Although trade unions in Indonesia have shown they can make a difference to workers’ lives, many struggles still lie ahead. The minimum wage must be raised to a living wage and all workers must benefit from social security. Said Iqbal says that for 2015, the unions will ask for a 30 per cent increase of the minimum wage.
We need a good minimum wage if we want to build a welfare state. And we refuse to wait. We need to find this solution together with the other Indonesian trade unions.
IndustriALL backs the campaign of Indonesian trade unions for continued increases of minimum wages to secure a living wage, the social security reform and limiting outsourcing in favour of decent jobs.
An increase of the minimum wage is nothing to fear,
says IndustriALL general secretary Jyrki Raina.
Last year there were wage increases in many countries around Asia. Unions in Bangladesh managed to get a 77 per cent increase in 2013, and the minimum wage in China is already higher than in Indonesia. It is high time that Indonesian workers and their families get their share of the profits they actually help create.