The law provides broad rights of association for workers in the private sector but places restrictions on organizing among public sector workers. Workers in the private sector formed and joined unions of their choice without previous authorization or excessive requirements. The law stipulates that 10 or more workers have the right to form a union, with membership open to all workers, regardless of political affiliation, religion, ethnicity, or gender. The Ministry of Manpower and Transmigration records, rather than approves, the formation of a union, federation, or confederation and provides it with a registration number.
To remain registered, unions must keep the government informed about changes in their governing bodies. The law allows the government to petition the courts to dissolve a union if it conflicts with the state ideology (Pancasila) or the constitution. A union also may be dissolved if its leaders or members, in the name of the union, commit crimes against the security of the state and are sentenced to at least five years in prison. Once a union is dissolved, its leaders and members may not form another union for at least three years. There were no reports that the government dissolved any unions during the year.
Although the law recognizes civil servants’ freedom of association and right to organize, employees of several ministries may only form employee associations, with more limited rights. Union organizations sought to organize government employees, as well as state-owned enterprise (SOE) employees, although they encountered resistance from enterprise management, and the legal basis for registering unions in SOEs remained unclear.
The law prohibits employment discrimination against union organizers and members and provides penalties for violations. The law also requires employers to reinstate workers fired for union activity.
The right to strike is recognized but substantially restricted under the law. Under the Manpower Development and Protection Act (the Manpower Act), workers must give written notification to the authorities and to the employer seven days in advance for a strike to be legal, specifying the starting and ending time of the strike, venue for the action, reasons for the strike, and including signatures of the chairperson and secretary of the striking union. The law does not extend the right to strike to most civil servants or to workers in SOEs.
A 2003 ministerial regulation declares illegal all strikes at “enterprises that cater to the interests of the general public or at enterprises whose activities would endanger the safety of human life if discontinued.” Although this wording recalls the definition of an “essential industry,” the regulation does not specify the types of enterprises affected, leaving this determination to the government’s discretion. The same regulation also classifies strikes as illegal if they are “not as a result of failed negotiations.”
Before workers can strike, they must engage in lengthy mediation with the employer and proceed to mediation facilitated by a government mediator or risk having the strike declared illegal. In the case of an illegal strike, an employer may make two written appeals within a period of seven days for workers to return. Workers who do not respond to those appeals are considered to have resigned.
The law provides for collective bargaining and allows workers’ organizations that register with the government to conclude legally binding collective labor agreements (CLAs) with employers and to exercise other trade union functions. The law includes some restrictions on collective bargaining, including a requirement that a union or unions represent more than 50 percent of the company workforce to negotiate a CLA. External observers note that this excessive requirement adds additional barriers to enjoying the right to collective bargaining. The Manpower Act, which regulates collective bargaining, and general employment conditions, does not apply to workers in SOEs.
On November 17, The Ministry of Manpower and Transmigration issued implementing regulations on the right to organize and bargain collectively. According to the Manpower and Transmigration Ministry, approximately 25 percent of companies with more than 10 employees had CLAs. Although most of these agreements went beyond the legal minimum provisions set by the government, more than a third of employers reportedly violated the terms of the CLA with relative impunity. Enforcement of CLAs varied based on the capacity and interest of individual regional governments.
In practice, the government did not effectively enforce laws protecting freedom of association and prohibiting antiunion discrimination. Some unions reported local ministry offices prejudicially recommended denial of registration.
Antiunion discrimination cases moved excessively slowly through the court system, sometimes taking up to six years. Bribery and judicial corruption in workers’ disputes continued, and courts rarely decided cases in the workers’ favor. While dismissed workers sometimes received severance pay or other compensation, they were rarely reinstated. Companies sometimes transferred union leaders to jobs where they could not continue their union activities. Managers in some locations reportedly employed thugs to intimidate and assault trade union members who attempted to organize legal strike actions, and at times, the police intervened inappropriately and with force in labor matters, usually to protect employers’ interests.
Labor activists continued to claim that companies orchestrate the formation of multiple unions, including “yellow” unions, to weaken legitimate unions.
Activists reported that there were stronger antiunion sentiments and actions by employers in special economic zones (SEZs). For example, employers in the Batam SEZ tended to hire labor on two-year contracts and favored workers under 24 years of age, in part to inhibit union formation.
Employees at the Surabaya Zoo established a labor union in June 2010. However, the zoo management attempted to stop the union from operating. Police and forest rangers threatened the labor union members and tore down the labor union’s signboards. Labor activists received threats if they continued to assist with unionization. One employee was fired for her role in the establishment of the union. Management reduced the salary and benefits of those who joined the union. The union was informally disbanded when the zoo’s managing body refused to extend the contract of the labor union’s activists, arguing that members participated in an illegal strike in 2010. While the union was legally intact at year’s end, none of the members were active. The City of Surabaya Industrial Court asked zoo management to reemploy the 30 fired union activists; zoo management has appealed this to the Constitutional Court. At year’s end, the appeal was still pending and the union activists had not been reemployed.
In practice, the cumbersome process required for a legal strike, as well as the government regulations included in the Manpower Act provided employers a clear means to obstruct a union’s move to legally strike. Therefore, strikes tended to be unsanctioned or “wildcat” strikes that broke out after a failure to settle long-term grievances or when an employer refused to recognize a union. The primary reasons for strikes during the year were 1) demand for an increase in salary, 2) suspension of overtime payment and/or regular salary, 3) unjust dismissal of workers, and 4) the illegal use of contract workers.
Employer retribution against union organizers, including dismissals and violence, was not prevented effectively or remedied in practice. Employers commonly used intimidation tactics against strikers, including administrative dismissal of employees through use of the appeals process described above. Some employers threatened employees who made contact with union organizers. Management singled out strike leaders for layoffs when companies downsized.
A notable series of strikes occurred at Freeport’s copper and gold mine in Papua Province. Between July and December there were a series of negotiations and mediations punctuated by strike actions. Workers initially demanded a significant increase in minimum wages across the pay scale, reported to be in the range of 600 to 1,200 percent. Freeport responded with an 11 percent annual increase over two years. Freeport workers established roadblocks blocking access to Freeport’s main road on October 11. Freeport and the union reached a labor agreement on December 23, and workers removed the roadblocks on December 25.
Union leaders reported that they faced intimidation from mine operators, including withholding of wages of striking workers. Management at Freeport Indonesia also reported cases of intimidation, including pressure on contract workers by union members to join the strike. During the strike, an increased police presence near Timika aimed to prevent unrest. On October 10, one miner died during a clash between police and protestors. During the clash, police fired live ammunition at protesters.
During the year workers staged protests in major cities demanding companies pay into the national social security system, put an end to corrupt business practices, and that the government pass the social-safety-net bill. Parliament passed the demanded legislation on October 28.
In recent years employers have repeatedly filed criminal complaints against union officers following failed collective bargaining negotiations or lawful strikes. In a number of cases, union officers were prosecuted and even served prison time for destruction of property and interference with profits as a result of complaints brought by employers. Some provisions in criminal law have aided these tactics, such as a crime of “unpleasant acts,” which creates criminal liability for a broad range of conduct. There were credible reports of the police investigating or interrogating union organizers.
The increasing trend of using contract labor directly affected unions’ right to organize and bargain collectively. Under the Manpower Act, contract labor is to be used only for work that is “temporary in nature.” However, according to an International Trade Union Confederation report, many employers violated these provisions, sometimes with the assistance of local offices of the Manpower Ministry. In these cases, companies declared bankruptcy in order to avoid severance payments provided for under law, closed the factory for several days, and then rehired workers as contract labor at a lower cost. Union leaders and activists usually were not rehired. Labor courts have ruled in favor of workers who filed either for compensation or to be rehired. In most cases, however, the company has appealed to the Supreme Court where the labor court’s decisions have been overturned.