Ridwan Max Sijabat, Jakarta – Three decades have passed, but state insurance company PT Jamsostek's holding monopoly in social security programs has yet to show its performance in providing job security for workers – despite its improved financial performance under new management.
The company netted 5.4 million new workers in 2007, mostly employed in the informal sector and non-permanent development projects.
These figures bring the total to 7.9 million workers actively participating through the company, out of 24.4 million workers registered in their programs. The remaining 16.5 million have remained inactive.
Jamsostek president director Hotbonar Sinaga said the company had faced difficulties with dormant companies and their workers,
He said it was difficult to reactivate worker participation in their programs because, unlike welfare states, Jamsostek had no authority to enforce the 1992 law on social security programs.
"The law is in the hands of the (central and local) government, the Attorney General's Office and the police," Hotbonar said recently.
"Jamsostek has no investigative authority to have all companies and workers participate in the compulsory social security programs. We have only administrative power to carry out the programs and manage all funds collected from participants."
Jamsostek reported last year an audited net profit of Rp 910 billion, up by 110 percent from the targeted Rp 828 billion.
It has proposed not to pay 30 percent, or Rp 273 billion, of the profit to the government, and to use the social security program funds, which have reached Rp 60.4 trillion, as trust funds to improve employee social welfare.
"But it all depends on the House of Representatives and the government, which have the right to review the law," Hotbonar said. We have proposed a new bill to amend the law but so far no response has been given," he said.
Jamsostek's director of operations and service Achmad Ansori said many companies had registered only a part of their workers with Jamsostek.
He said others had reported only a part of the workers' monthly salaries – two major violations into which Jamsostek staff had no authority to investigate.
Many employers were found to have acted dishonestly around worker registration with Jamsostek, in efforts to reduce their financial burden.
Following the enactment of the harsher 2003 labor law, many private and state companies have rationalized their permanent workers and recruited contract-based employees.
These companies have also moved to outsource administrative and security jobs to reduce labor costs to minimum, including basic insurances, allowances and bonuses.
Ansori said these violations could be halted and some 10 million workers yet to be registered with Jamsostek could be protected if labor inspectors were deployed to enforce the law.
The law requires companies with at least 10 workers or more, or workers with a monthly payment of Rp 1 million each, to participate in social security programs. Any violation can carry a maximum sentence of one year imprisonment or a fine of up to Rp 1 billion.
"Labor unions and the Indonesian Employers' Association (Apindo) should also... raise the awareness of employers and workers in the social security programs' and about the importance of industrial relations," Ansori said.
Manpower and Transmigration Minister Erman Suparno said he would set up a joint team comprising the government, labor unions and Apindo, to help persuade employers to register their workers with Jamsostek.
Former minister of manpower Bomer Pasaribu said the government had shown political weakness toward enforcement of the law and protection of workers.
Bomer said the government, the House, and Jamsostek had each turned a blind eye to the major law violation.
"Jamsostek should not be satisfied with the huge funds it has collected from workers, but should proactively file a lawsuit against companies violating the law," he said.
"Labor unions should stand behind Jamsostek to report on violating companies to the Attorney General's Office and the police."
Bomer also said Jamsostek's monopoly should be ended if it was found unable to realize its mission.