Op-ed: Dimensionality of Industrial Relations in Indonesia

National development in the manpower sector is dimensional in nature which is not only related to the interests of the workforce, but also concerns the interests of the government and employers. These three elements become stakeholders who are bound to a dynamic industrial relations. In creating harmonious industrial relations, stakeholders need to base their interests on their respective principles, namely: 1) success in business activities is a common interest, so stakeholders must work according to their duties and functions, and 2) employers and workers must benefit each other . For example, entrepreneurs add company branches so they can absorb more workers.

The dynamics of industrial relations in Indonesia recently have been characterized by problems of disharmony between employers and their workers. This disharmonious relationship is usually triggered by cases of Termination of Employment (PHK). As stated by Haiyani Rumondang, Director General of Development of Industrial Relations and Employment Social Security (PHI- JSK) of the Ministry of Manpower (in the writing of Selfie Miftahul Jannah – detikFinance, 29 December 2017), it was recorded that up to November 2017 there were 9,822 workers who had experienced layoffs from the previous year namely 12,274 workers. Even though in 2017 Indonesia experienced a decrease in the number of layoffs, there was an increase in the number of cases, in 2016 there were only 1,599 cases, while in 2017 it reached 2,345 cases. The government as the leading sector in industrial relations should act based on the provisions of the legislation or applicable legal products. Industrial relations sector legal products are regulated in Law Number 02 of 2004 concerning Industrial Relations Dispute Settlement (PPHI). Where the law requires that the PPHI process can be realized which can meet the expectations of all parties.

In the context of maintaining industrial relations in Pasuruan Regency, regulations have been stipulated in the form of Regional Regulation (Perda) Number 22 of 2012 concerning the system of employment administration. At first glance, it has been mentioned that the philosophical basis regarding the provisions of Article 41 (1), (2) and (3) in the regional regulation, that the government’s guidance, supervision and enforcement functions, instilling the principle of balance of interests in the rule of law which contains the values of honesty, decency, fairness, as well as moral demands, such as rights, obligations and responsibilities in relations between humans in accordance with the Pancasila precepts, where workers and employers have a reciprocal relationship that has human values, there is no discrimination, and seeks adjustments in understanding through deliberations in building partnerships in the working relationship between workers and employers, and through partnership building the parties maintain conducive working conditions, while still paying attention to the welfare of workers and their families, on the other hand workers carry out their obligations according to applicable regulations and can adapt to the work environment.

In the Industrial Relations Dispute Settlement (PPHI) there are 4 types of settlement namely: (1) Settlement through Bipatride, (2) Settlement through Mediation (3) Settlement through Conciliation, (4) Settlement through Arbitration. UUPPHI has introduced Arbitration as a media for dispute resolution which includes disputes over interests and disputes between trade unions and employers within a company, outside the industrial relations court through a written agreement from the disputing parties to submit dispute resolution to an arbiter whose decision is binding on the parties and is finals. Arbitration is different from mediation and consolation. The difference lies in the procedures for examining disputes and the legal consequences of the results of the examination. Examination on arbitration is carried out with procedural law similar to the procedural law of the Industrial Relations Court. The results of the arbitrator’s examination are set forth in a written decision. While the results of the examination of the mediator and conciliator, are set forth in the form of written recommendations.


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