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Formal sector workers still deprived of basic benefits

Jakarta Post - May 1, 2011

Tifa Asrianti, Jakarta – Despite working for a German sports apparel company that amasses annual profits of millions of dollars, garment manufacture worker Jamiatun can barely make ends meet for her family.

After a decade of labor at the garment company, she earns a monthly salary of Rp 1.29 million (US$143). As her husband is always between jobs, living expenses and the two children's education swallow almost all of her income.

"I can't afford to get sick," she said. "If I fell ill and had to skip work for one day, the company would cut my pay."

The salary she receives is the provincial minimum wage, but as a garment and textile sector worker, she should actually receive Rp 1.38 million.

She said that when an accident happened at work, the company would take the injured worker to the company's health center but expected the worker to work again the next day. For illnesses that last more than two days, the company makes workers pay for medication.

"The company only gives me a salary and Jamsostek [social security allowance], but they don't offer health insurance or workplace injury insurance," she said.

Jamiatun and Khumsoni pay Rp 250,000 per month for their three-by-three meter rented room where they sleep and cook. The couple shares the electricity and water bills with other people living in the rented room complex as they share one electricity meter and a communal bathroom.

Khumsoni said they ate whatever they could afford. "If we are short on money, then we don't eat," he said.

Jamiatun said she stuck with her job because of her children and the eventual old-age savings she could cash in. "People may think those working in the formal sector have a better life than those working in the informal sector. But my reality is very different."

Despite the formal sector status, the work barely fulfills the International Labor Organization's definition of decent work, which includes opportunities for productive work that delivers a fair income, security in the workplace and social protection for families.

Many formal sector workers are not registered with all five mandatory social insurance schemes as mandated by the social security law. The ILO's 2010/2011 World Social Security Report stated that less than 20 percent of the country's 170 million working age population were registered to a pension scheme in 2009.

"In fact, about 83 percent of workers remain uncovered by social insurance [old-age, occupational injury and death]," stated another ILO report titled Labour and Social Trends in Indonesia 2010. It added that healthcare coverage was higher at 46 percent in favor of Jamkesmas, the tax-funded healthcare provision for the poor.

Indonesian Democratic Party of Struggle (PDI-P) legislator Rieke Dyah Pitaloka said workers needed to be protected by the social security system, especially universal health coverage. "With universal health coverage, people can get free medication regardless of their location or income," she said.

The social insurers bill (RUU BPJS), which is currently being drafted, could help expand the provision, but its deliberation is stalled with unresolved debate between the government and lawmakers over the bill's purposes and the ideal forms of the insurers.

"A recent meeting with the government sparked the idea the social insurer in the bill could take the form of multiple entities, not just one," Rieke said.

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