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Indonesian workers rally to reject layoffs

Weak currency should not be excuse for dismissals: Church group
Indonesian workers rally to reject layoffs

Thousands of workers rallied in Jakarta on Sept. 1 to warn that a faltering economy should not give employers an excuse for layoffs. (Photo by Ryan Dagur)

Published: September 01, 2015 10:55 AM GMT
Updated: September 01, 2015 12:29 AM GMT

Thousands of workers staged large rallies in cities across Indonesia Sept. 1, urging companies not to choose layoffs as a solution to a struggling economy.

In Jakarta, nearly 30,000 workers from various labor organizations gathered in the capital.

“We stage these rallies to address the worsening economic condition faced by this nation,” Said Iqbal, chairman of the Confederation of Indonesian Workers Unions, told ucanews.com in an interview.

He worried that the plunging rupiah, Indonesia’s currency, will lead to employees laying off their workers. The value of the rupiah has continued to weaken since the beginning of the year, from about 12,500 rupiah per US dollar to almost 14,000 at the start of September.

“Now layoffs are the big threat. What will workers’ fate be like? We come here to remind the government that layoffs should not happen,” he said.

Instead, the union leader called on the government to raise minimum wages by almost one-quarter next year in order to offset workers’ diminished purchasing power.

Mudhofir, chairman of the Confederation of Indonesian Workers Welfare Unions, said more than 50,000 people across the country have been laid off this year. The layoffs have been concentrated in the garment, textile, and the food and drink industries, he said.

“This is an emergency situation,” said Mudhofir, who uses one name. “Thus, we call on the government to take measures.”

 

Layoffs or stagnant wages?

Church officials say the economic situation has put Indonesian workers in a precarious situation.

FX Yono Hascaryo Putro, who works on labor issues with Jakarta archdiocese’s Daya Dharma Association, said employers are using the weakened rupiah as an excuse not to raise wages.

“There’s a dilemma among workers,” he said. “Investors use the condition as a chance not to raise their wage. So the option is only layoff or not raising the wage.”

Yet the current minimum wage, he said, is barely enough for workers to plan for their futures.

“In Jakarta, for example, a single worker spends about 30 percent of their monthly minimum wage to pay the rent of a house and uses the rest for food and transportation … It means that they can barely save money for their future,” he said.

In November 2014, monthly minimum wages in Jakarta were raised by about 12.5 percent, to the current 2.7 million rupiah, or just under US$200.

However, workers attending the Sept. 1 demonstrations said such wages were barely sustainable.

Thirty-year-old textile worker Mahyudin, who uses one name, said he earns about 2.9 million rupiah a month. After rent and expenses, it only lets him put away about 10,000 rupiah each month for his son’s future — about US$7.

“That’s why I join these rallies. I want to live properly,” he said.

Earlier, Manpower Minister Hanif Dhakiri called on companies not to lay off their workers despite the economic climate.

“In my ministry, we have talked with businessmen to make layoffs the last option, instead of the first priority, in addressing the crisis,” he told media Aug. 31, according to Kompas.com, a local news website.

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