Desy Nurhayati, Jakarta – Labor unions have demanded the government and private companies strictly enforce laws on outsourcing, which they say have been rampantly misused to reduce labor costs.

Weak monitoring by the government has further disadvantaged workers, as the practices itself creates job insecurity, the unions said Thursday.

"Regulations on outsourcing have been misused by employers to reduce their responsibilities over workers' rights for their own benefits and the government is unable to conduct strict supervision to eliminate these unfair practices," Rekson Silaban, chairman of the Confederation of Indonesian Prosperous Labor Union (KSBSI), said.

The 2003 labor law allows major companies to outsource jobs to other companies, but must insure those companies uphold labor laws, something the unions say is not happening. Business people have defended outsourcing, as they say it makes their products more competitive.

Rekson said their is no transparency in outsourcing contracts, and added that many companies have outsourced parts of their core business, a violation of the law.

He also criticized the government for readily giving permissions to companies to outsource, without close monitoring. "Core businesses are not allowed to be outsourced, but this happens because companies can easily obtain permits from manpower authorities."

Thamrin Mosi, president of the Confederation of the Indonesian Workers' Union (KSPI), and Mathias Tambing, deputy chairman of the Confederation of the All-Indonesian Workers' Unions (KSPSI), expressed similar concerns.

"The weak monitoring has something to do with the lack of professional labor inspectors and the lack of attention of regional heads under regional autonomy," Thamrin said.

Mathias cited the fact that many employers have bribed there way out of their violations of the outsourcing system.

Observing May Day, KSBSI will hold a march involving 3,500 labors from the Hotel Indonesia traffic circle in Central Jakarta to the presidential palace. KSPI and KSPSI said they would not hold rallies on Labor Day and would instead use a more diplomatic approach and hold dialogs to fight for workers' rights.

Sastro, national coordinator of the Indonesian Alliance for the Defense of Laborers (ABM), said that the system has severely weakened the bargaining position of laborers' as they lack the power to negotiate for basic commitments like remuneration and working hours.

Director of the Jakarta Legal Aid Institute (LBH) Asfinawati concurred, saying the government had misconceptions about treating employers and workers equally.

"We repeatedly hear the government's pledge to treat the business owners and laborers equally, but it is absolutely clear that it is the laborer with a low salary who needs more protection from the government." (hwa)

Law No 13/2003 on labor

Article 65

1. The delivery of jobs to other companies shall be done through a written working contract agreement.
2. Workers protection and requirements for workers at the other company shall be at least the same as working protection and requirements at companies outsourcing the jobs, or in accordance with the provisions of prevailing laws.

Article 66

2. Providers of labor services for supporting activities not related directly to production shall meet the following requirements:

1. working relations between companies providing labor services exist;
2. a prevailing working agreement on working relations is a working agreement for a specified period that meets the requirements and/or labor agreement for unspecified period which is signed by both parties;
3. wage protection and welfare, occupational requirements as well as the arising disputes are the responsibility of companies providing labor services; and
4. agreement between companies providing labor services and other companies acting as companies providing labor services is made in writing and must contain the articles on this matter in this law

Labor condition in August 2008

• The work force totals 111.95 million, up by 2.01 million from 109.94 in August, 2007
• The number of people working at home is 102.55 million, up by 2.62 million from 99.93 million in Aug. 2007
• Open unemployment is 8.39 percent in Aug. 2008, down from 9.11 percent in the previous year.

Sources: Manpawer Ministry and BPS