At least 10 companies are considering closing their businesses in
Indonesia and relocating to other countries unless the government settles
several labour issues that they claim hamper the investment climate, according
to an influential business association.
Chairman of the Indonesian Employers’
Association (Apindo) Sofjan Wanandi said the foreign investors’ plan was
apparently driven by legal uncertainties from labour issues.
He said Apindo had asked those
businessmen to delay their moves pending the outcome of Apindo’s lobbying of relevant
authorities to solve the problems within two months.
“Many other foreign investors
will certainly follow suit if the 10 companies relocate to other countries.
This will certainly have serious negative impacts on the foreign investment
climate in the country and on unemployment,” Sofjan said at a seminar on job
security in the outsourcing system on Tuesday.
In total, those 10 companies
employ no less than 10,000 workers.
Sofjan declined to identify the
10 foreign investors and the amount of their investment in order to avoid any
serious problems in their connections with banking partners in the country.
“We have asked them to suspend
the relocation and give Apindo two months to lobby the relevant authorities to
cope with the problem. If the condition remains unsettled and uncertain, we
will give up and the relocation will be unavoidable,” he said.
Sofjan said several investors had
locked up their factories and several others had laid off their workers
following the national strike on October 3 in numerous industrial estates
nationwide.
According to him, many employers,
including the 10 foreign investors, could not accept intimidation carried out
by labour unionists at factories that banned their workers from joining the
strike.
Hundreds of factories in 40
regencies and municipalities, including Jakarta, Bekasi, Sidoarjo and Batam,
had to suspend their operation as their workers were forced to join the strike
in their opposition to outsourcing practices, cheap labour policies and
national social security programmes, causing investors to lose millions of
working hours and to suspend export and import activities.
In addition, Sofjan said Apindo
and employers would legally challenge the Manpower and Transmigration Minister
Muhaimin Iskandar if he went ahead with his plan to issue a new ministerial
decree to limit outsourcing only to catering, cleaning services, driving and
supporting services at mining sites.
“If the minister issues the
decree, he would breach the 2003 Labour Law. It shows that he does not
understand outsourcing,” said Sofjan.
He added that the 2003 Labour Law
neither mentioned outsourcing nor limited the number of jobs that could be
outsourced.
Endang Susilowati, head of
Apindo’s advocacy and public policy division, concurred and said it would be
impossible to end outsourcing, which had provided advantages to both investors
and workers.
National Workers Union deputy
chairman Djoko Heryono said the manpower and transmigration minister should
revoke the 2004 outsourcing ministerial decree and enforce the Labour Law,
which had clearly served to regulate outsourcing.
Ridwan Max Sijabat
Business & Investment Opportunities
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