COUNTRY REPORT

COUNTRY REPORT

SERIKAT PEKERJA NASIONAL

(SPN)

National Industrial Workers Union’s Federation (NIWUF)

Reported by :

Lilis Mahmudah

Yeheskiel Dwi Yunantha Prabowo

Izzah T Inzamliyah

Country : INDONESIA

ORGANIZATIONAL PROFILE

Name of the Union             : SPN (Serikat Pekerja Nasional) National Industrial   

                                                  Workers Unions’ Federation (NIWUF)

                                                 

Registration                          : 146/V/IX/2001, September 4, 2001

Address                                 : Graha Mampang 3th floor

                                                    Jl. Mampang Prapatan No. 100

                                                    Jakarta Selatan 12790

                                                    Phone 62 21 7988835, Fax 62 21 7981957

                                                    Email : spn_dpp@yahoo.com

                                                : dep_ppa@yahoo.com       

Industrial Scope                   :     a.  Textile

b.      Synthetic Fiber

c.       Garment/Cloths

d.     Shoes and leather

e.      General Industries

National Affiliation            : KSPI/ITUC (Indonesian Trade Union Congress)

International Affiliation    : 1.TWARO (Textile Workers’ Asian Regional                                                                     Organization)

                                                  2. ITGLWF (International Textile Garment Leather                                                           Workers’ Federation)

    

Membership                            : As of December 2004, 470.753 members, 34  

                                                   : Branch Level, 539 Plant Level Union  

                                                   

HISTORY

Serikat Pekerja Indonesian (SPN)/National Industrial Workers’ Federation (NIWUF) was established on July 14^th 1973 as a sector within FBSI, SPN a merge from Serikat Buruh Kulit dan Karet (SBKK (Rubber and Leather Trade Union and Serikat Buruh Tekstil dan Sandang-SBTS (Textile and Garment Trade Union).

In 1985 FBSI changed from federation into unity union and called Serikat Pekerja Seluruh Indonesia-SPSI (all Indonesian Workers Union) and then back to federation called FSPSI in 1995 with 11 Sector Union base on each sector and one of  union sector is SPTSK (textile garment shoes and leather union).

The organizational structure of FSPSI as only Trade Union Organization in Indonesia was very complicated with both the federation and sector union have the same branch office at district, regional and national level but not at plant level. During the new era regime, the government created FSPSI as a part of government political strategy.

The drastic change of government policy that occurred regarding the trade union movement, that is the ratification of ILO convention number 87 and 98. This had a large impact to the future of trade union organizations especially to the existing FSPSI and its’ sectored union. On those changing spirit together with 11 out of 13 sectors in FSPSI, SPTSK resigned and formed FSPSI REFORMASI.

Actually SPTSK started to restructure and reform the union since 1995. SPTSK think that there’s an urgent to reform the union into a more democratic, more independent and more professional bodies focused on representing and servicing the respective plant level branches and membership. During 1995-1997 SPTSK try to collect database, set up sub sectors department and develop union leadership at all levels by continuing education program to create a younger and newer leadership from below and within the union.

On September 1999,  SPTSK held its’ congress that was attended by the members from plant level union. It was a new thing for trade union movement in Indonesia. The new constitution and national guidelines was set up on the congress. Based on those new constitution SPSK changed its’ from in Federation, and becoming an independent union.

On October 2003, SPTSK held next congress that was attended by 600 delegations were represent 539 plant level union.  The congress was decided that SPTSK become SPN these decision was decided to anticipate industrial situation especially in textile, garment, shoes sectors.     

Membership Scope

Most of SPN members come from textile, Garment, Shoes/Sportswear, toys and leather. But now SPN had been a Federation that why for next future SPN try to recruit new members form others industries.

The Programs

I.      Proffessionalize the Union

a.         Create National Recruitment Organizers

The main task of recruitment organizers is to organize the unorganized workers and to reorganize the former SPTSP (company union) and other

b.         Create National service Organizers

The main task of the service organizer is to give assistance to the plant level unions in the following problems:

q  Dispute settlement

q  CBA negotiation

q  Advocacy

q  Union Administration

II.            Education Programs

To implement the National Guidelines and training program are very important. These programs will raise the capability of the members and will strengthening their bargaining position. The programs covers the following subjects:

1.      Basic Trade Unionism

2.      Trade Union Leadership include Women Leadership

3.      Negotiation Skill.

4.      Paralegal and advocation

5.      Economy, Politic and International network

6.    Women workers’ protection and child labor.

III.            Other Programs

To organize seminars, workshop and other activities to develop and strengthen the organization in the following important topics i.e:

1.      Company Code of Conduct

2.      Social Clauses/Social Charters

3.      Social Safety Net Programs

NATIONAL BOARD COMPOSITION

PERIOD 2003 - 2008

President                                           :           Bambang Wirahyoso

Chairperson                                     :           Rustam Aksam

Chairperson                                     :           B. Rukman Abdul Jihad

Chairperson                                     :           Lilis Mahmudah

Chairperson                                     :           Ir. Rio Irwan Karyono

Chairperson                                     :           P. Karel Sahetapy

General Secretary                            :           Soeparman SHR

Secretary                                           :           Adi Rakhmat

Secretary                                           :           Umi Siti Akhiroh

Secretary                                           :           Erlyna Subandijah

Secretary                                           :           Joko Haryono

Research Department                     :           H. Iskandar SA.g Msi

Research Department                     :           Yeheskiel Y.D. Prabowo

Country Report- Indonesia

General Overview

The topic of the Multi Fiber Arrangement-phase out was come to the surface since 2002. But the discussion and debate still in the level of the labor union activist while there’s no significant effort done by the government to face the collapse of the textile and garment industries. Meanwhile the mass laid off, partial lay off due to efficiency and changing of working system from permanent to contract base was happening everywhere. The Textile Employer’s Association (API) predicted that Indonesia is going to loose 1.2 million workers due to the MFA-phase out.

The prediction is now seems so true because based on the data from our union (see the chart 3) the number of membership is getting decrease dramatically. Almost three hundred thousands members are now not working in the company where SPN is exist, though based on the statistic released by the government (chart 1 ) there’s no significant changes in the number of workforce in the textile industries. We don’t know where the discrepancy comes from.

Despite all the contradictive statistics, trade union movement faces a great challenge here in Indonesia especially by the enactment of the new labor law. The labor law gives more rooms on what called as “labor market flexibility”. As we know that the system is merely give as many profit as it can get for the company rather than for the workers because the company can easily fire the workers without the need to give the compensation to the workers. This can happened because the employment relation is changing from the permanent relation into contractual relation and even the company can outsource the work into home industries so then the company won’t need to pay the required wage, insurance and other benefit to the workers. This will create the shifting of the formal employment relation into informal employment relation. The one who will suffer by this system is again the poor which is also the workers. This enactment is applied in the same time as the MFA phase out, so it creates a wide range of problems. For more detail we will present the problems more in this report.  

The Statistics

1. Change in numbers of employee in the Textile/ Garment Industry

Chart 1

MANPOWER OF INDONESIAN TEXTILE INDUSTRY 2000 – 2004

Unit : People

No	Kind Of Industry	2000	2001	2002	2003	2004	2003/ +/-	2004 %
1.	FIBER	29.324	29.682	29.447	29.447	29.447	-	-
2.	YARN	193.361	207.871	209.426	207.764	207.764	-	-
3.	FABRIC	349.392	355.566	343.158	343.923	343.998	75	0,02
4.	GARMENT	372.716	376.584	350.901	362.457	353.590	1,135	0,32
5.	OTH.TEX.PROD	247.372	249.622	249.280	249.280	249.280	-	-
	TOTAL	1.192.166	1.219.325	1.182.212	1.182.871	1.184.079	1,208	0,10

Source : Depnakertrans, Depperindag RI (Processed)

Based on above chart we can see that there’s no significant change in number of workforce in the textile and garment industries. This chart was taken from the Manpower Department and Trade and Industrial Department.

2. Change in number of employers in the textile/garment industries

Chart no. 2.

The number of Company in Textile Industry

2000	2001	2002	2003	2004	2003/2004
					(+/-)	%
2,649	2,665	2,646	2,654	2,661	7	0.26

Source: Depperindag (the trade and industrial department)

From this chart we can see that the number of employer rise in 2004 but we can’t find any updated data for 2005 especially after the quota ended, so we still can’t see the fluctuation.

3. Change in the Membership of the SPN (NIWUF)

Chart 3

Membership Data of SPN

NO	Province	2002	2003	2004	2005	Lost	Description
1	Banten	107.579	96.961	68.541	60.000	47.579	Factory
2	Jawa Barat	153.276	137.784	135.637	114.942	38.334	Closure and
3	DKI Jakarta	46.671	36.831	36.831	22.650	24.021	Efficiency and
4	Jawa Tengah	117.890	177.455	177.455	123.175	54.280	Split from SPN
5	Jawa Timur	50.984	41.914	41.913	21.155	29.829
6	DI Yogjakarta	8.193	8.193	8.193	4.500	3.693
7	Sumatera Utara	3.129	2.183	2.183	1.883	1.246
	Total	487.722	501.321	470.753	348.305	298.459

Source: verification data of SPN

As we can see from the chart no. 3, during 2002-2005 SPN lost 298.459 of its membership due to factory closure or efficiency and also split from the union.

This data is taken from the recent membership verification done by national board of SPN

4. Change in the foreign investment in the textile/garment industries

Chart 4

CAPITAL INVESTMENT ON TEXTILE INDUSTRY 200 – 2004

Unit : Rp. Billion

No	Kind of Industry	2000	2001	2002	2003	2004
1.	Fiber	10.938,57	11.640,09	11.929,09	11.929,09	11.929,09
2.	Yarn	23.077,20	24.777,12	25.040,15	25.040,15	25.040,15
3.	Fabric	30.458,20	30.811,02	31.428,19	31.636,87	31.638,49
4.	Garment	2.715,40	2.808,61	2.913,65	2.958,80	2.964,81
5.	Oth.Textile Product	60.737,68	60.786,27	60.790,00	60.790,00	60.790,00
	Total	127.927,14	130.823,11	132.101,08	132.354,91	132.362,54

Source: Indonesian Textile Employer’s Association (API)

Based on the chart we can see that the foreign investment is tend to rise in the garment sector, while for textile there’s a rise from 2000-2002 but after that it remains stable.

5. Change in the Production volume at major textile/garment factories

Chart 5

Production Volume and Value 2000-2004

Description	Unit	2000	2001	2002	2003	2004	2004/2003
							(+/-)	%
Value	Rp. Billion	86,813	89,417	82,412	82,258	85,577	3,281	4.00
Volume	KG	5,170,000	5,156,842	4,200,006	4,193,552	4,361,294	167,742	4,00

Source: Depperindag RI, compiled from various

The decrease of production volume was started in 2001 but we can see that the value getting increase and then decrease continue in 2002 both in value and volume. During 2002-2004 the value and the volume remain stable.

6. Change in wages and working conditions in the textile/ garment industries

Minimum wage in Indonesia is setting on the provincial basis. The wage is setting through a committee where the members come from the representative from the employer association, trade union and government. The committee discusses the proposal of the rise submitted and then do the market survey based on the items in the standard of living. So often a deadlock is occurred during the discussion. Final decision will be made by the governor or the mayor/regent.

Based on the labor law, the minimum wage should reach the Standard for a Descent Life and not based on the standard of living anymore, but we can see from the chart below that until now the minimum wage is still not even reach the standard of living amount.

Chart 6

The Provincial Minimum Wage in SPN Membership Area

No
Kind of Provincial		2002	2003	2004	AVG
1	Sumatera Utara	A B C	453,000 464,000 97.63	455,996 505,000 90.3	482,489 537,000 90.00	463,828 502,000 92.64
2	Jawa Barat	A B C	373,488 280,799 75.18	320,000 320,000 100.00	418,258 366,500 87.63	370,582 322,433 87.60
3	Jawa Tengah	A B C	345,604 314,500 91.00	387,121 340,400 87.93	368,367 365,000 99.09	367,031 339,967 92.67
4	Jawa Timur	A B C	277,783 245,000 88.11	260,659 274,000 105.12	309,363 310,000 100.21	282,601 276,333 97.81
5	DKI Jakarta	A B C	519,931 591,266 113.72	746,749 631,554 84.57	699,713 671,550 95.98	671,143 631,456 98.09
6	Banten	A B C	- 360,000 -	- 475,000 -	- 515,000 -	- 450,000 -
7	DI Yogyakarta	A B C	321,766 321,750 100.0	364,722 360,000 98.71	355,000 365,000 97.26	237,729 348,917 98.66

Resource : Web Depperindag RI (Prosseced by SPN)

A = Standard of Living, B = Minimum Wage, C = Percentage

7. Change in the exports to Developed Countries (US, Europe, Other Market)

Chart 7

TOP TEN OF INDONESIAN EXPORT TEXTILE & TEXTILE PRODUCT, 2004

NO	Country of Destination	VOLUME KG	Share	VOLUME USD	Share
1.	USA	206.566.998	12,70	2.371.109.986	31,01
2.	JAPAN	128.437.411	7,90	471.975.910	6,17
3.	GERMAN	48.790.921	3.00	455.620.788	5,96
4.	UK	41.019.117	2,52	383.033.544	5,01
5.	UNI EMIRAT ARAB	46.250.016	2,84	269.717.836	3,53
6.	SOUTH KOREA	82.229.806	5,06	200.100.956	2,62
7.	ITALY	50.246.777	3,09	197.423.907	2,58
8.	MALAYASIA	67.171.479	4,13	192.435.266	2,52
9.	HONGKONG	56.942.307	3,50	183.031.642	2,39
10.	BELGIUM	33.481.487	2,06	162.691.087	2,13
11.	OTHERS	865.348.439	53,20	2.760.310.359	36,09
	TOTAL	1.626.484.758	100,00	7.647.451.283	100,00

Source: Depperindag RI (compiled  by Textile Employer’s Association)

This chart shows that during 2004 the export value is remain high, but in the field the management saying differently when the trade union asking for the increase of the wage and other allowances.

The Specific Conditions Face by SPN Members

Start from the beginning of 2002 SPN looses a great number of its membership. Start with the closure of PT Doson Indonesia, the factory produced NIKE shoes, which causing more than 6.000 workers unemployed then followed by many factories produces world-major brand such as Kashogi, Nike (for the sportswear), the factory producing dolls for Harrod’s supermarket and many more.

Many SPN affiliates reported that they also facing difficulties in maintaining their members because of the company keep reducing the number of workforce due to financial difficulties they face. According to the employer these difficulties happened because of the buyer is not putting any order to the company anymore. Some of the company (e.g: the company produces Lea Jeans) choose to make a “take turn” arrangement, where every workers have to work for two weeks and have two weeks off after that with full payment. Eventhough the workers get full payment it creates unrest situation for every worker because they feel that the closure of the company is only in a matter of time before come to reality.

Many affiliates also feel the need to be more compromise in some of their demands. They start to set new priority that focuses on keeping the job rather than the struggle in getting better working conditions. They feel that the sacrifice is needed. This situation is put the officers in the dilemma because the members don’t want to loose what they already get every year.

SPN is also face a great difficulties in organizing new members because of the changing system in employment relation (as explained in the next item) also creating a hindrance on the organizing new members effort for trade union because workers who work under contract (or only in permanent base) are usually facing intimidation from joining a union and often when they sign a contract they get a verbal warning from the management to not forming or joining a union. Some of them also just graduated from school, so they don’t know the right as workers as stipulated by law. But even for the one who used to be the member of the union, they also face intimidation if they try to form a union in their new workplace so then they can do nothing except just receive all condition without questioning it.

The changes of the behaviours in labor-management relations

The trend shown by the employer is the changes in employment relation from permanent base into contractual base. Some of the company just simply closed the factory and open the new one but they recruit workers based on the contract base. Other employer change the system by selling their stock/share or their ownership on the company and then the status of all employee change into contractual base or even some factories applied the zero year of service for all employees and also change their status into contractual base.

The use of labor suppliers’ company as a tool for recruiting workers is also getting common nowadays. This creating another problem because of the employee has no direct employment relation with the employer of the company where she/he works, so then if they face any problems in the workplace they can’t settle the dispute or have a negotiation with the owner of the factory where they work.

Another system applied is thorough outsourcing. The company will outsource some of the works to home industries or the family in the surrounding area of the factory to do some auxiliary work such as putting a button in a shirt, trim the thread etc. The works paid based on the result(pieces they gain) and not based on the daily payment. This workers in this kind of area are not considered as “workers” as stated in the labor law so then according to the employer they are not entitled of a benefit or protection as stipulated by the labor law.

Most of workers in this kind of company are not protected well. They only get the minimum wage, not belong to any union because of the threat from management, not covered by any kind of insurance, and always put in insecure condition. And most of them have no choices because they need the job.

The changing behavior of the management in facing the trade union when they negotiate the collective labor agreement or wage rise is also occurred. Usually they tell the trade union that they face financial difficulties so they can’t give the rise or amend some of the articles in the CBA so then they give difficult option to the union. The union usually has to choose to keep demanding the rise or the company will be closed down.

But relating to the mass closure of many factories, the employers do not use the issue of MFA-phase out as the reason for the closure. They said that if trade union or workers demand wage rising and betterment working condition then they will relocate to other countries such as China, Vietnam, or Cambodia. The Task Force Team on Post Quota found out that the relocation is not only a threat. Many buyers said so.

Tripartite and Bipartite Relation on MFA-Phase out

The discussion on MFA-phase out attended by the representatives from the government of Indonesia, the employer’s association, and trade unions was held several times. Based on that then the Task Force on Post Quotas, an alliance of some trade union and NGO which has concern on workers in garment and textile industries, was established. This alliance, facilitated by Workers Right Consortium (WRC), has met the world major brand’s buyers such as Adidas, Nike, GAP etc to discuss the trade union concern on the post quota issues. The buyers give a promise that the phase out won’t give an impact on the industry. They said that this industry will remain survive, no lay offs, and no factory closures. This statement is far from reality because what happened now is so contradictive.

The Indonesian government working together with “Balai Tekstil Bandung” (Bandung’ Textile Laboratory—government’s supporting institution) has initiating the round table discussion on corporate social responsibility (CSR). The discussion held once in four month and attended by the representatives from trade unions, NGOs, employer’s association, the chamber of commerce, the manpower department and the trade and industry department. The main topic for the discussion is how to minimize the negative impact of foreign investment and also related to the MFA-phase out. Up till now the discussion is still on the stage of setting up a committee so there’s no significant result yet.

On the bipartite level, there’s not common for the plant level union to talk about the impact on MFA phase out, but a small number of plant level union start to monitor every changing behaviour  of the management and ask for clarification as soon as possible and try to discuss  every possibility that might happened to the phase out. Most employers are not so keen in talking about this issue. They simply say that this is not the area for trade union to know more. So we can say that in most company where SPN exist there’s no bipartite discussion on this issue.

Program Planned by The Government

The government, through the trade and commercial department, has a development strategy for the textile and garment industry which consist of the following steps:

1. Long Term Step

G Strengthen the connection of the industrial chain for textile and garment. It means that the government will ensure the availability of the raw material for the industry. This fulfillment should be done by domestic enterprises and not import anymore. The government also plan to developing supporting industry for textile, building capacity for the human resources, developing the research and development and developing the partnership among high scale enterprises and small scale enterprises

G Strengthen the ability to market penetration both nationally and internationally by developing and maintaining the quality and design of products, combating smuggle activities, standardization of products and customer protection.

2. Short Term Step

G Actively promote “Our Own Product” in home and foreign countries by establishing Operational Cooperation Team and also actively involved in the international event such as Source-it/ Hongkong Interstoff

G Realization of Textile Industry Restructure by giving special incentives for restructuring the company

G Minimize production cost through energy conservation

G Actively supporting the implementation effort on social accountability (WRAP, SA-8000 etc)

G Encourage the employer to develop incentive system for workers based on productivity

G Facilitating the readiness of working capital for anticipating the availability of the raw or supporting material for fulfilling the fast delivery request

G  Encourage the conducive industrial climate

From above description seems that the government is focuses more on maintaining the industry and has no specific approach for workers.

Effort and Strategy of SPN

As an institution SPN is actively doing the campaign on the need for take a serious consideration in the MFA-phase out situation. The campaign is done through many activities such as seminars, sending letters to the government, joining the CoC Networking etc. We realize that up till now the government give no attention to our letter, but we will keep the demand to the government.

In the effort of raising awareness to our members, we also conduct socialization and education activities. The main topic we discuss are globalization, the impact on MFA-phase out, and how to use the code of conduct as a struggle tool for the trade union, introducing an alternative protection tool for workers such as ILO convention, CEOC Guideline, CSR etc.

Internationally, SPN working together with other ITGLWF affiliates sending resolution to WTO demanding for postponing the phase out.  

The Proposal for ITGLWF/TWARO and ILO/ACTRAV

1. ITGLWF/TWARO and ILO/ACTRAV working together in facilitating an international campaign and advocacy to minimize the impact on the phase out for the workers in Indonesia and other country
2. ITGLWF/TWARO serving as mediator for doing the campaign and advocacy on the violence of workers’ right in the multinational company in all countries especially for the country face the impact on the MFA phase out
3. ITGLWF/TWARO backed up on every impact face by the workers in the textile and garment industry happened due to the campaign or the market consolidation (e.g shoes and leather)