The Illegibility of the Informal Sector

Malang-based Mitra Wanita Pekerja Rumahan Indonesia (MWPRI) (Partner of Female Workers in Home Industries) has made its way into the press, with very similar articles in The Jakarta Post this week and Jawa Pos earlier this month regarding the government’s uneven recognition of workers in the informal sector:

“The government seems to ignore their existence. Although there is much stimulus funding allocated to the informal sector, it never reaches this kind of worker,” Ratno [Cahyadi, chairperson of MWPRI research and legal division] told The Jakarta Post on Sunday.  She added the government only recognized those who worked independently in the informal sector.  “So those who work for employers in the informal sector are not recognized in the manpower law.”

Ratno said Manpower and Transmigration Minister Erman Suparno had guaranteed that Manpower Law No. 13/2003 would protect formal and informal workers, but the ministry has so far only recognized those who doing informal jobs, instead of workers in the informal sector.

“The uncertainty in the definition of informal workers had entrapped millions of people in ‘modern slavery’. Workers in the informal sector do not have a standard minimum wage, work safety rules or health benefits. Unpaid workers and child labor exploitation are also rampant in the sector,” she said.

What Ratno Cahyadi describes in The Jakarta Post is an informal sector that can be divided into various categories of employment and self-employment, while a recent International Labor Review article on the informal sector looks at the idea of dividing the informal job market into “voluntary,” upper-tier informal work and “involuntary,” easy entry informal work.  All of which aligns with the ILO’s 2002 report on the informal sector, which stated that “Increasingly, ‘informal sector’ has been found to be an inadequate, if not misleading, term to reflect these dynamic, heterogeneous and complex aspects of a phenomenon which is not, in fact, a ‘sector’ in the sense of a specific industry group or economic activity.”

Coupling this heterogeneity with the difficulties in quantifying the informal sector mentioned in the Jawa Pos article and the fact that the “informal sector” made up over 60% of the Indonesian workforce in 2007, we begin to get a picture of the breadth of complexities groups like Mitra Wanita Pekerja Rumahan Indonesia (MWPRI) are up against in pushing for policy solutions.

April 5th Rally: “Let’s Unite Against Capitalism, Let’s Unite Against the Elite Elections”

From the IndoLeft news service comes this “solidarity appeal” from the Politics for the Poor-Indonesian National Front for Labour Struggle (FNPBI-PRM), regarding a mass rally to be held days before the parliamentary elections.

In the midst of the inability of the ‘yellow’ or pro-government trade unions to respond to these  problems, the Solidarity Alliance for Labour Struggle (GSPB) and the Politics for the Poor-Indonesian National Front for Labour Struggle (FNPBI-PRM), are endeavoring to undertake consciousness building work and the mass organisation of workers in the Jakarta satellite city of Bekasi and surrounding areas.

This work has primarily been in the form of establishing labour struggle coordination posts in poor residential areas where workers live. The coordination posts are used to distribute leaflets, hold discussions and meetings, and for film showings and education seminars. To date, nine such labour struggle coordination posts have been established in  Bekasi, and this continues to expand.

In addition to having to confront the global financial crisis, Indonesian workers are also faced with the legislative elections on April 9, followed by the election for president and vice-president on June 9. For Indonesia’s poor and working class, these elections can provide little hope for change – but rather more of the pro-capitalist and neoliberal policies that have been pursued by the parties elected in 2004 elections and are leading to the growing impoverishment of millions or ordinary Indonesians. Not one of the political parties participating in the elections has a track record of fighting for the interest of the working class and the poor. On the contrary, many of these parties are remnants of Suharto’s New Order regime or have been formed by former New Order generals, human rights violators, corrupt government officials or business tycoons.

It is because of this therefore, that on April 5 the GSPB along with a number of other organisations active in the people’s movement such as the women’s organisation Perempuan Mahardhika, the Union for the Politics of the Poor (PPRM), the Jakarta Poor People’s Union (PRMJ), the Politics for the Poor-National Student League for Democracy (LMND-PRM) and the Indonesian Buskers Union (SPI), will be holding a joint mass rally in Jakarta as part of this consciousness building work under the theme “Let’s Unite Against Capitalism, Let’s Unite Against the Elite Elections”. In addition to the meeting in Jakarta, similar mass meetings will also be held in other Indonesian cities.

The mass rally in Jakarta is planned to involve some 500 people and will be held at an indoor venue. The event will involve presentation by labour movement leaders – both those involved in initiating the rally plus other invited speakers. The rally will also include a people’s poetry reading and a choir singing of songs of struggle. The mass meeting is intended as part of preparations in the lead up to massive demonstrations on May Day this year.

In order to organise the event, we will need funds of some 20 million rupiah, or around US$2000. Unfortunately, efforts so far to raise funds from our own members have only be sufficient to cover the needs of the labour coordination posts that have already been established and fall far short of what will be needed for the cost of hiring an indoor venue or the transportation costs of participants. There will also be additional expenditures such as light refreshments and the cost of publicising the event.

We are writing to you to appeal for financial assistance to support this event. If you or your organisation is able to make a donation please send it to:

Account Holder: Jaringan Nasional Perempuan
Mahardhika
Account Number: 0534-01-0037-73-50-6
Swift code: BRINIDJA

For further information about FNPBI-PRM and on preparations for the mass rally, please feel free to contact us by email at fnpbi.prm@gmail.com or visit our website at www.fnpbi-prm.blogspot.com.

In solidarity,
Budi Wardoyo, Coordinator FNPBI-PRM

It will be interesting to see if this is a sign that golput, or an election boycott, has traction among left organizations and whether it will be a centerpiece of strategy.  Perhaps even more interesting, though, are the network of coordination posts being developed in Bekasi working class neighborhoods.

Two FSPMI Activists Arrested In Union Busting Effort

News from Federasi Serikat Pekerja Metal Indonesia and the International Metalworkers’ Federation of union busting efforts at PT Takita, a Japanese owned metal-stamping facility in Cikarang, Bekasi.

FSPMI is calling for the Indonesian President to intervene to ensure the release of shop stewards Evi Risiasari and Yuli Setianingsih, who are in prison as a result of their union activities.  The sisters have been fighting to secure ongoing employment for all 152 employees at PT Takita Manufacturing, where less than half of the workers have permanent jobs…

The FSPMI is holding daily protests with other workers in front of the factory in Cikarang, Bekasi, around 50 kms from Jakarta.  Management of the Japanese company targeted the sisters for their union activities and accused them of falsifying medical leave.  When the sisters denied the accusation, they were threatened with immediate dismissal and forced to sign written statements agreeing to the charges.

The news release also sights the “invisible costs” of doing business in Indonesia as an issue for the union, both as a way to limit full-time employment and as a way to enforce union-busting measures.

As is common practice in the region, corrupt Human Resource management at the company take bribes from labour suppliers to continue hiring contract workers.  FSPMI Secretary Iqbal Said said corruption within the judiciary also made long prison terms for the sisters a very real possibility.

Majority of Companies in Malang Defy New Minimum Wage

According to The Jakarta Post, the Malang Manpower and Transmigration Agency is estimating that around 60% of the companies in the regency are not paying the new 2009 minimum wage, a rate even higher than the 40% the Konfederasi Serikat Pekerja Seluruh Indonesia (KSPSI) previously estimated for East Java as a whole.  Companies can apply for exceptions if they can’t afford to pay the new wage, but few are bothering with this step.  Rather they are simply not paying the new minimum wage and hoping that it will be overturned in court, a strategy advocated by APINDO (The Indonesian Employers’ Association).

The regency’s head of Manpower and Transmigration gives an uninspiring description of process by which the new minimum wage could be enforced:

When asked whether the hundreds of violating companies would be punished, Jaka [Malang Manpower and Transmigration Agency head] said it was likely, but given the current economic situation, he said he preferred not to enforce stiff sanctions.  He added violating companies would not be directly punished, but would be summoned beforehand. Workers would also be invited to sit together and discuss the salaries they would receive.

“The government is responsible for providing guidance, to prevent layoffs. We have to be engaged in such discussions to prevent layoffs, on the grounds that the companies cannot afford to pay workers’ salaries,” he said.  Jaka added the employers could be considered in violation of the law, but before taking measures, three warnings must be issued as part of the guidance steps.

“The aim of law enforcement is to implement the law, but there are other objectives, such as counseling through dialogue to seek a solution so as not to implement stiff penalties, such as enforcing punishments immediately upon violation,” he said.

Given the various governmental players involved (a previous governor’s decree, the courts, and the Manpower and Transmigration Agency), along with the usual labor-capital interests, the outcome of this case could be an interesting test of where the power lies among these groups.

Max Lane on Upcoming Elections

In his latest blog post, Max Lane gives his take on the upcoming parliamentary elections and the controversy among left political groupings over the decision of PRD-Papernas to back the Star Reformation Party (more here).  Below is his position on the previous discussed role (or lack there of) of class & economic policy in the upcoming election:

Forty-four parties are registered for the April 9 elections, including six Acehnese parties that will participate only in that province. All the national parties support the general direction of current economic and political policies: they are either parties of the 1965-99 Suharto New Order period or what might be called “fake reformasi” parties. The latter rhetorically try to associate themselves with the reformasi democratisation movement of 1998 that forced the resignation of General Mohammed Suharto as Indonesia’s president. However, none of them have offered any resistance to the neoliberal economic policies introduced over the last five years by the government of President Yudhoyono.  On one occasion the Indonesian Democratic Party of Struggle (PDIP), headed by Megawati Sukarnoputri, staged a walkout against a foreign investment law, protesting some clauses it thought were too pro-foreigner, but it did not pursue opposition any further. Differences among the parties on economic questions have been minor.

Where Have All The Protests Gone?

The Jakarta Post ran a three part report on labor issues in the current economy, with articles on the role of unions, the rampant disregard of legally obligated severance packages, and the effects of layoffs on Java’s industrial areas (the descriptions of which resemble the Obama quote in our previous post).

The article on unions tries to answer the question of why there have been “fewer street protests by the unions, at least since January,” when workers are going through such hard times.  The article suggests one factor is the government intervening on both sides of the capital-labor divide in order to maintain labor peace through the election season.  The article includes this stinging critique of labor union officials:

Indonesia is home to more than 1,000 unions, most of them run by activists rather than actual workers.  The activists usually exploit their union platforms for personal gain, including vying for top positions in political parties, state companies or government agencies.  The lack of action from the unions is also due to requests from law enforcement authorities to top union leaders to lie low during the upcoming general elections, over concerns of igniting conflicts and riots.

The article certainly implies some complex relationships in capital-labor-state accommodation.  The issue of varied interests among union officials is particularly interesting, and unclear if it is suggesting a lingering form of corporatist influence over unions or just a certain trend of opportunism?

In regards to unions staying quiet through the elections, could this be some measure of the legacy of the New Order’s “security approach” to labor relations?  Or is it more simply a sign that, with a steady flow of layoffs, labor is bargaining from a position of weakness and must necessarily lower demands?  And wouldn’t this appear to be a missed opportunity to force workers’ issues into the public discourse and into an election in which class has a limited role?

Obama Imagines Workers in a Post-Industrial Indonesia

In the lead up to and in these early days of the Obama administration, there has been plenty of ink spilled and tea leaves read, trying to imagine what such an administration would look like.  For those interested in Indonesia, most of the statements are impressionistic at best, scraps which could be used to imagine a more progressive US policy towards Indonesia.  For the interests of this blog, there is one particular passage to go on, from Obama’s memoir Dreams of My Father.  In the passage Obama imagines a post-industrial Indonesia and its consequences, connecting these potential hazards to the struggles he was seeing at the time in a Chicago neighborhood:

I tried to imagine the Indonesian workers who were now making their way to the sorts of factories that had once sat along the banks of the Calumet River, joining the ranks of wage labor to assemble the radios and sneakers that sold on Michigan Avenue.  I imagined those same Indonesian workers ten, twenty years from now, when their factories would have closed down, a consequence of new technology or lower wages in some other part of the globe.  And then the bitter discovery that their markets have vanished; that they no longer remember how to weave their own baskets or carve their own furniture or grow their own food; that even if they remember such craft, the forests that gave them wood are now owned by timber interests, the baskets they once wove have been replaced by more durable plastics.  The very existence of the factories, the timber interests, the plastics manufacturer, will have rendered their culture obsolete; the values of hard work and individual initiative turn out to have depended on a system of belief that’s been scrambled by migration and urbanization and imported TV re-runs.  Some of them would prosper in this new order.  Some would move to America.  And the others, the millions left behind in Djakarta, or Lagos, or the West Bank, they would settle into their own Altgeld Gardens, into a deeper dispair.

So what can be taken from a the words of a pre-politican Obama of over a decade ago imagining a soon to be post-industrial Indonesia?  Very little, I should imagine.  Certainly nothing specific, besides perhaps some solace in knowing that the US now has a president that at least took a moment to give the topic some thoughtful consideration.

Garment Workers Protest Over Severance Pay

Between 100 and 200 garment workers protested outside the Jakarta City Council, demanding the government intervene and force PT Inkosindo Sukses provide legally obligated severance pay after laying off 1,300 workers.  The protest included one arrest, according to the Tempo report.

From The Jakarta Post write-up:

Inkosindo Employees Forum head Siti Nurul Alifah said the company, which produces apparel for internationally renowned brands, filed for bankruptcy in early January and laid off around 1,300 employees “without adequate severance pay”.  She added the North Jakarta District Court had yet declare the firm bankrupt.  “The management only gave us 20 percent of our pay. That’s rubbish. Under the labor law, severance pay may not cut by percentages like that,” Siti said.

Workers and the 2009 Election

Back in January, the Jakarta Post ran this article, showing the results of election polling of workers done by Federasi Serikat Pekerja (FSP) BUMN Bersatu (Federation of United State Enterprise Worker Unions).  The article has all the ambiguities one might expect when a study is turned into a newspaper article, the most glaring of which is any definition of “workers” (are these FSP BUMN members?  union members? workers more generally?).  A cursory web search didn’t turn up the full results of the survey, which could be quite fascinating.

The article included the following chart, of which no mention is made in the article itself, suggesting a marked increase in the number of “laborers” who will stay home on election day.  The chart certainly raises the issue of golput (boycott) in the upcoming elections, whether its a matter of voter apathy or a concerted strategy.  It will also be interesting to see what is being said about golput in labor/left circles.

Below are the rest of the results.  At a glance, it seems there may be less disparity between leadership choice and party choice among these “workers” than among the population more generally, either based on the 2004 election results or the expected 2009 results.  President Yudhoyono’s popularity across parties was a major driver for that disparity, but the SBY effect may be largely neutralized given his low approval ratings among workers.

What about the role of class?  In explaining the results, FSP BUMN Bersatu Chairman Arief Poyuono explained, “The workers use a simple way to measure the performance of the government. What they see is that the price of Indomie (instant noodles), rice and public transport have now more than doubled compared to when Megawati was president.”  While that perception is no doubt a major factor in Megawati’s popularity among workers, it will be interesting to see how that gets weighed against Liddle and Mujani’s observation that “most parties and candidates claim to represent the lower class.  Their economic platforms are uniformly protectionist, making it difficult if not impossible for voters to discern policy differences.”  Liddle and Mujani’s own analysis of the 2004 elections suggested the sociological factors did not play a key role in voting among the general population.

President Megawati	30.7%
Josuf Kalla	19.6%
Yudhoyono	12.7%
Prabowo Subianto	7.7%
Sultan Hamengkubowono X	6.5%

Party Preference PDI-P	26.7%
Golkar	20.1%
Partai Demokrat (PD)	6.3%
Gerindra	10.9%
Prosperous Justice Party (PKS)	9.7%
Development Unity Party (PPP)	7.3%

Down and Out in Hong Kong

The Jakarta Globe has this profile of the harrowing tales of Indonesian migrant workers at a shelter run by Kotkiho, the Coalition of Indonesian Migrant Workers Organizations in Hong Kong.

According to the Indonesian Migrant Workers Union, more than 110,000 Indonesians currently in Hong Kong migrated there in search of better lives by working as domestic helpers. Anik Setyo, the vice chairman of IMWU, said that most of the workers employed in the territory were paid well by Indonesian standards, although most still earned below Hong Kong’s minimum wage, and their employers treated them well, compared to the endemic harsh treatment in such countries as Saudi Arabia.