John McBeth – For all the democratic space created after the fall of President Suharto, with Indonesia signing on to the core principles of freedom of association and the right to collective bargaining, the country's trade union movement has not been the force many have expected.
Prominent labor activists like Muchtar Pakpahan and Dita Indah Sari, both jailed for fighting for workers' rights during the New Order years, have faded from public view, unable to parlay their national exposure into broad political popularity.
Pakpahan's Labor Party failed to gain a single seat in the 2004 and 2009 elections. Sari is now a useful adviser to Manpower Minister Muhaimin Iskandar. Other former unionists have also moved out of activism and into mainstream jobs.
But the days of docile labor may be changing, with a 6.5 percent growth spurt giving many Indonesians a new-found prosperity.
The three-month-long strike at Freeport Indonesia's copper and gold mine is significant because of its unmistakable message: that employers cannot expect business as usual when commodity prices – and profits – are at an all-time high.
"It is having a huge impact," Indonesian Employers Association chairman Sofyan Wanandi told The Straits Times, pointing to the way unions are educating themselves on the Internet. "The workers here are trying to copy what they are doing at Freeport and our government is too weak (to respond)."
Faced with a threatened strike – and a looming gubernatorial election – Jakarta's city administration last week buckled to demands for a 20 percent increase in the monthly minimum wage to 1.52 million rupiah (S$220) – the lowest salary for a single person with less than a year's experience.
More than 10,000 workers marched in Batam on Nov 24 demanding a similar increase, and there have been signs of further unrest among state railway, airline and telecommunications employees, and in industrial parks around the nation's capital.
Only 3.3 million of Indonesia's workers belong to unions, or 10 percent of those in the formal economy, which in turn is just a third of the total economy. That number is actually less than what it was in previous years, but labor experts say it takes time to build a genuine movement.
Apart from the Confederation of All-Indonesia Workers' Union, the only state-sanctioned union during the Suharto era, there are now three other confederations embracing nearly 80 different federations and 11,000 workplace unions.
Critics claim the national-level organizations have been hijacked by political interests, leaving the workers in much the same situation as before, with inadequate wages and poor conditions.
The cash-strapped confederations are more political in their approach because their main role is to lobby for changes to the labor laws and seek improved social protection. They are also very weak.
Freeport union leader Sudiro seems to have forged stronger linkages to international labor organizations, such as the United Steelworkers, than to his own confederation.
There is also evidence of intra-company collusion, borne out by the 60-day strike at parent company Freeport McMoRan Copper & Gold's Cerro Verde copper mine in Peru, where the workers may not be demanding as much, but have been equally tenacious.
At the company level, unions look for direct benefits, services and cooperation with employers. In many cases, however, they do not have the skills and the leverage needed for collective bargaining, usually relying on government mediation to resolve disputes.
Payrolls are only part of the equation. Wanandi says the government has to do more to remove infrastructure bottlenecks that cost producers time and money, particularly at Jakarta's Tanjung Priok port, which handles 70 percent of the country's exports.
Logistical headaches add 15 percent to the price of doing business in Indonesia, compared with 5 percent to 6 percent in better-developed countries. Add a further 5 percent to 10 percent for corruption and bureaucratic red tape, and it is inevitably the worker who loses out.
Indonesia's new labor laws, pushed through by the populist Megawati Sukarnoputri government, appear out of balance. Employers face onerous severance payments of 30 times a worker's monthly salary, even when criminal activity is involved. Yet Indonesia occupies the 86th place among 100 selected countries on the International Labor Organization's 2010 list of workers with the lowest average minimum wage – or below US$250 (S$330) a month.
That ranges from US$155 a month in far-off Papua to US$65 in Central Java, well below levels in Thailand and the Philippines, where even the lowest monthly wage is US$160.
Eight of the country's 33 provinces recently agreed to raise the minimum wage by up to 17 percent, employing what is now a nationwide mechanism in which employers and workers conduct their own livelihood surveys and try to find middle ground.
In Jakarta, the recent 20 percent increase still means workers are barely keeping pace with the cost of basic living standard scale, which contains 48 components covering rent and basic necessities that are adjusted for inflation.
Freeport is offering a 35 percent rise, partly because Papua has a much higher cost of living. But that is only for the lowest-paid worker. Others on higher pay scales all want the same deal.
It is the same for Jakarta's workers, particularly those engaged in the car assembly, electronic and textile industries, who feel the minimum wage should be 5 percent higher than other less profitable sectors. All that remains to be seen now is how far the contagion will spread.