B. Josie Susilo Hardianto – The lunch boxes had only just been handed out when they began to discuss the story of Mardi – a worker in Tangerang, Banten province. He had just sent his two children back to his village."They've being entrusted with Mardi's parents so they can go to school", said Bagus, who provides support to workers.

Mardi's income as a contract labourer was simply not enough to cover the cost of looking after his children. Fortunately, his parents in the village were prepared to look after both children and at the same time befriend them during quiet periods.

There was another story about a worker who – although they were already working – was still receiving help from their parents. Every month their parents in the village provided them with rice because the wage they were receiving was not enough to meet their daily needs.

Bagus said that although they worked as a contract labourer in the formal sector, their parents continued to help by providing this subsidy, a social cost that should be born by the company.

Then, there is the tale of a worker who had to spend up to 2 million rupiah to obtain work as a contract labourer for three months. The question is, how can this be happening?

Market paradigm

Benny Hari Juliawan, a researcher on labour issues, says that these problems cannot be separated from the market paradigm that is gaining current within the labour market. The market, with its law of supply and demand plays the principle role in these cases.

According to Juliawan, these kinds of problems started after the economic crisis abated and liberalisation was seen as the most effective medicine. Although looking at it from earlier historical examples, it was initiated by Britain and the United States when Margaret Thatcher and Ronald Reagan were in power.

Indonesia, as a part of the global community, cannot escape this. The enactment of Law Number 13/2003 on Labour was greatly influenced by a compromise with the current of liberalisation. One aspect of this was introduced by the emergence of the concepts of contract labour and outsourcing.

In this context, workers are viewed simply as an element in the production process and must submit to the ideology of the market, which is based solely on the law of supply and demand. Workers are the same as any other type of input, like thread, cloth or plastic, and their position is almost equivalent to that of an industrial commodity. Whereas producing a worker it is far different from producing goods or industrial materials.

Herry B. Priyono, a lecturer from the Driyarkara School of Philosophy, says that the commodification of workers is not 100 percent possible as is the case for other elements of production – like land or capital."Workers have free will, hopes and so on", said Priyono.

Workers have rights as human beings and as workers. Because of this therefore, workers cannot just be forced to summit to market mechanisms.

Juliawan says that it requires at least 18 years to produce a worker. He or she requires food, healthcare, education and protection, which cannot just be measured based on the law of supply and demand.

What often happens however, is precisely the opposite. A compromise is reached between the market and state, which gives birth to such mechanisms, whether they are legal or formal. All of this tends to place workers in a position of being no more than a commodity.

Such a view is of course wrong. Priyono again asserts that workers are not the same as land or capital. "They have free will", he says.

The state, says Priyono, should in fact take steps so that for workers, market performance does not act as brutally against them as it does with land or capital, which can be bought and sold. There is another paradigm that requires attention – the paradigm based on the concept of workers as human beings.

Position of the state

In early 2006 there was an article titled "Regulating Labour is not the Dominant Factor", which noted that the results of a survey by the World Economic Forum (WEF) in 2005 found that the factor that most hinders investment is government bureaucracy. Ranked next was inadequate infrastructure, tax regulations, corruption, the quality of human resources and policy uncertainly. "Labour is not the principle factor," said Juliawan.

Employers he said, are confronted with problematic regulations, such as taxes levied for generators or street lighting that they themselves have installed. In such as situation, the state or government has lost the character of bonum commune and tends to submit to the accumulation capital. This tendency moves the state away from its principle role as an agency that produces public policies and guarantees social welfare – the very purpose of the state's existence.

These tendencies have become rampant with the emergence of polices such as Law Number 13/2003 on Labour. Juliawan specifically points to the provisions which state that a worker can be contracted for two years, and if necessary, the contract can be extended for one more year. After this, if they are to continue to be employed, the worker concerned must be promoted to a permanent employee.

In reality however, this is not the case. Workers are maintained as contact labourers."Permanent employees are only employed as administrative staff", he said.

Worse still, there is has been a tendency for this to mushroom, with the instinct of labour market liberalisation embodied in Articles 64, 65 and 66 on labour placement and Articles 35, 36, 37 and 38 on the implementation of placement.

Predatory instinct

According to Juliawan, the compromise between the state and the current of liberalisation that arises in the labour law has in fact stimulated the emergence of what is referred to as predatory instinct. In Tangerang, West Java for example, it is customary for labour agencies to charge a fee for workers to be provided to a particular company.

The limited demand for labour also results in each agency competing against each other and workers are trapped within this fight. Under conditions such as this, the labour movement has appeared as part of this history.

According to Priyono, the existence of the labour movement has become what is referred to as a mutual check of the labour market that seeks to turn workers into a commodity.

Although it does not submit to the law of equity, the labour movement will exist and continue to exist for as long as the commodification of labour is not absolute. "This is because workers have free will", he said.

This concept further asserts that workers are not merely a factor in production, let alone a commodity. In this context, the state can also thus act to weaken the market through affirmative action and the enactment of laws. At the very least, the government can ensure that the market does not behave as brutally towards workers as it does towards land and capital.

For example at least, the state could explicitly state that although there is space for contract labour, dismissals are made difficult. Or after three years of working as a contract labourer, the state provides a guarantee that they will be promoted to a permanent employee. If after three years they are not promoted, the state could provide a guarantee to train the worker concerned so that they are not unconditionally surrendered to market mechanisms.

This is of course related to the ideological position of the state in guaranteeing – that in the public's interest – it functions so that society does not have to subsidize either capital or the state. If however it turns out that the state fails to recognise that workers have never submitted 100 percent to market mechanisms and become 100 percent a commodity, the state will become one that that is naive, or even stupid.

[Translated by James Balowski.]