PROGRESS Seminar in Indonesia

JILAF, together with the Confederation of Indonesian Trade Unions (CITU, or KSPI), held a labour-management relations and productivity seminar (PROGRESS*) in the city of Makassar in South Sulawesi, Indonesia, on September 10-13. The four-day seminar was attended by 35 people from six CITU-affiliated industrial federations; 60% of them were from the Federation of Chemical, Energy, and Mine Workers’ Unions (FSP-KEP), the Federation of Indonesian Metal Workers’ Unions (FSPMI), and the Federation of Pharmaceutical and Health Workers’ Unions (FSP FARKES REFORMASI).

As the CITU’s demand for wage raises gathers momentum ahead of the revision of the minimum wage in fiscal 2014, the seminar shared the view with participants that in order to realize the sustained development of the Indonesian economy, the most important issue for the government, labour, and management is increasing the living standards of workers in conformity with improvements in labour productivity.

In a keynote speech on the first day, CITU General Secretary Muhammad Rusdi gave an analysis of the present situation, noting that although Indonesia, a country with abundant natural resources and the largest labour and consumer markets in the Association of Southeast Asian Nations (ASEAN), has tremendous potential for economic growth, as of September 2012, there are still about 28.6 million Indonesians living beneath the $1-a-day poverty line and the average minimum wage for the whole of Indonesia is no more than 89% of the amount needed to cover the minimum living expenses required by a single person. General Secretary Rusdi emphasized that increasing the purchasing power of workers is necessary for sustained economic growth and that raising the minimum wage is the most important issue for the government, labour, and management. Referring to Japan’s experience, JILAF Deputy Secretary Bunzo Katsuo commented in response that “In order to improve the living conditions of workers in Indonesia, it is necessary to build constructive labour-management relations through corporate growth based on productivity improvements and the fair distribution of profits to workers.”

On the second day, the participants heard a lecture by JILAF expert Tomotaka Inoue on the significance of productivity improvement and ways of improving productivity, such as the 5S** and kaizen practices, and gained an understanding of the meaning of labour productivity in not only manufacturing industries but also service industries, such as hospitals and hotels. They also engaged in group work on 5S and kaizen practices in the case of instant noodles and IC chips.

On the third day, the participants visited Islam Faisal Hospital in Makassar, where they conducted a 5S patrol to identify workplace improvements. Although this was the first such experience for all of the participants, they were able to make a specific report on methods of sorting, setting thing in order, shining and kaizen. In response, the owner of the hospital commented that the hospital would apply an order of priority and implement the 5S and kaizen proposals, setting up a special team for the purpose. The inspection of the hospital, the owner said, had been a valuable experience for both labour and management.

On the final day, the participants divided into groups of workers, management, and observers and engaged in mock collective bargaining, using a tire factory in Makassar as a case study. In response to the final collective bargaining report, JILAF expert Inoue recommended, “Collective bargaining is more convincing if assertions are made based on evidence, such as labour’s share based on added value and the company’s ability to pay.” Finally, CITU Vice-President Ali Akbar stated that as well as collective bargaining, regular labour-management consultations accompanied by repeated discussions with shop-floor union members are an effective method. He stressed that efforts are important to reach an agreement while preventing the involvement of third parties.

The participants made such comments as “I want to put the 5S into practice in the workplace immediately” and “The productivity seminar would be even more effective if it was for the government, labour, and management together.”

*PROGRESS = PROGram on Role of Trade Unions in Empowerment and Strategic Steps to Decent Work
**The 5S principles refer to the first letters of five Japanese words: seiri (sorting), seiton (setting things in order), seiso (shining), seiketsu (standardization), and shitsuke (self-discipline).


09/10TueSeminar day 1: Lectures on “The Indonesian Economy and Role of Trade Unions,” etc.
09/11WedSeminar day 2: Lectures on “The Significance of Productivity Improvement,” “5S Practice,” etc.
09/12ThuSeminar day 3: Workplace inspection, 5S patrol, etc.
09/13FriSeminar day 4: Mock collective bargaining, etc.

Photos of the Participants

Practicing the 5S

Lecture on productivity improvement

Group work on kaizen

5S patrol

Visit to Islam Faisal Hospital

Mock collective bargaining