Ridwan Max Sijabat, Jakarta – The long-awaited labor court has been promoted as a fairer, faster and less expensive means to settle industrial disputes, which are likely to rise amid tough economic times.
It replaces the government-sanctioned Regional and Central Committees for Settlements of Industrial Disputes (P4D and P4P), whose procedures and decisions since their establishment in 1957 have been faulted as protracted, probusiness and ineffectual.
The special court, officially launched by Chief Justice Bagir Manan in Padang, West Sumatra, on Jan. 14, will start simultaneously in the capitals of 33 provinces. The appeals court will be held in the Supreme Court.
The Supreme Court is still awaiting a presidential decree to inaugurate 98 newly recruited ad hoc judges nominated either by employers and labor unions. They and 100 career judges at district courts will try a backlog of thousands of industrial disputes.
"The labor court will take effect following the inauguration of the ad hoc judges within this month," the director of law and court affairs at the Supreme Court, Suparno, told The Jakarta Post recently.
He outlined that under Law No. 2/2004 on the labor court (its implementation was postponed for one year), all industrial disputes would be settled within 140 days.
Disputing parties – employers, workers or labor unions – would not be subject to any court costs because the court was fully covered by the state budget, he added.
"The labor court is part of the national legal reform drive, putting the hearing of industrial disputes into the judicial system to give legal certainty to the conflicting sides, including investors and dissatisfied workers and labor unions, which have been in a weak position in industrial relations," he said.
Under the new law, workers and employers have legal certainty on how and when their dispute will be settled. Industrial disputes will be handled through bipartite negotiation, mediation, conciliation and, if needed, in arbitration or the special court over the designated 140-day period.
Disputes could be settled within 30 days if conflicting sides reach agreement in bipartite negotiations, or within 60 days if they settle their disputes in tripartite mediations in the presence of government mediators or "conciliators".
The manpower and transmigration minister has appointed a total of 165 conciliators and arbitrators to a five-year term of office.
Resolution of disputes should take only 80 days to be settled at the labor court and the appeal court. The sides are allowed to appeal to the Supreme Court for definitive verdicts if they are dissatisfied with the special court's decision.
He emphasized the spirit of the new law, which encourages conflicting sides to seek out-of-court settlements before taking the matter to the court.
"Conflicting sides will save energy, working hours and money if they settle their disputes in bipartite negotiations or tripartite mediations and agreements made during the negotiations. And (decisions from) mediation will be officially signed and registered with the labor court, which will execute them if any of the conflicting sides refuse to comply with the agreements."
Business groups have welcomed the establishment of the court, saying the legal certainty of its rulings will encourage investment.
"It is an institution with potential whose rulings could not be questioned in a higher court," Indonesian Employers Association (Apindo) secretary-general Djimanto said last week. Some labor unions have hailed the labor court as a breakthrough in expediting the resolution of industrial disputes, as well in cutting costs and providing legal certainty.
"There is no legal certainty under the old system, because any decisions made by P4P could be vetoed by the manpower and transmigration ministers or brought to the State Administrative Higher Court because the committee is part of the executive body," said chairman of the Confederation of All-Indonesian Workers Union (KSPSI) Jacob Nuwa Wea.
"This has cost workers and labor unions much time and energy in trying to get definitive decisions on their cases." Chairman of the Indonesian People's Labor Union (SPRI) Ruslan Effendi cautioned, however, the labor court would still have to navigate the same problems – particularly bribery – that dogged the earlier courts.
"We are skeptical that the labor court could provide justice to workers under the corrupt judicial system. We still fear that employers will have the chance to buy decisions, as they did with P4D and P4P," he said.
The number of industrial disputes is expected to increase, particularly with some employers choosing to dismiss part of their permanent workforce and replace them with contract workers for cost and efficiency.
These will add to the many cases already on the books. Apindo notes there are 508 outstanding cases of its members which will be taken over by the labor court from the P4P and the State Administrative Higher Court, with 1,500 more filed by workers and labor unions.