Industry Update

• The number of confirmed COVID-19 cases continues to rise and community transmission remains high. Shortage of hospital beds and treatment facilities continues to be a concern. The government continues urging all workers to work from home (if possible) and apply Covid-19 health protocols.
• The Jakarta administration has re-imposed “transition large-scale social restrictions (transition PSBB)” until early December 2020. Neighbouring districts in West Java and Banten continue applying “new normal protocols” whist others apply transition PSBB.
• “New normal” protocols detail how offices and manufacturers should operate during the PSBB. Moreover, such protocols require all workplaces, except those in essential sectors, to obtain a permit from the Ministry of Industry to be able to operate. The Ministry of Manpower has also issued similar circular letters to prevent transmission of COVID-19 in the workplace and ensure business continuity amid the pandemic.
• Garment and footwear factories in Indonesia have been severely impact by Covid-19. ILO data shows that in May and June 2020 export levels were down 60% compared to the previous year. In April 2020, the Indonesia’s Textile Association (API) reported that Covid-19 restrictions had halted operations temporarily in 80 percent of textile and textile product companies in Indonesia.
• On 31 March, the government announced a COVID-19 fiscal stimulus package worth IDR 405.1 trillion (USD 24.6 billion), focused on health care, social safety net measures, and business recovery programs for micro-enterprises. Tax relief and soft loans are also foreseen. That initial package has, in the meantime, been increased to Rp 695 trillion (US$47.39 billion), and the government further expanded its social aid programmes and incentives for micro, small and medium enterprises (MSMEs). Indonesia is struggling to disburse funds. By September 2020, only 26% of all allocated budget had been spent given issues related with access to data and beneficiaries, proper policy design and deficient government support systems.
• The pre-employment card programme (Kartu Pra Kerja) has been redirected to provide unemployment subsidies and skills training to affected workers from both the formal and informal sector but is being marred with criticism around appropriate coverage, targeting and relevance of training.
• The government has allocated Rp 37.7 trillion from the state budget for a wage subsidy program. Workers who earn less than Rp 5 million per month and are registered in the social security program (BPJS) would receive Rp. 600,000 stimulus disbursement by the end of August 2020.  It is estimated that around 15.7 million social security program beneficiaries will be included in the scheme.
• Better Work advises all factories to actively communicate with local governments about the assistance schemes provided to workers and employers. See below for more information on existing schemes:
  • Information on the Pre-Employment Card scheme
  • The policy on tax relief targeting the manufacturing sector
  • Policies on credit relaxation
• The Indonesian Ministry of Manpower launched an information web site on the outbreak, Posko K3. The website contains steps to generate a business continuity plan, preventive measures, good practices, and information on rights of workers who have contracted COVID-19. It also functions as an online forum for consulting and submitting complaints relating to OSH and COVID-19.
• Since the start of the pandemic, until end of October 2020, more than 158 export-oriented garment factories enrolled in Better Work were affected, i.e., they were temporarily closed or reduced working time/days/wages (for a period of time) due to COVID-19 PSBB restrictions or cancelled orders from buyers. To date, more than 156,000 workers were affected and 17,600 workers lost their jobs. In October 2020, 10,100 workers were in a furlough situation in 28 factories.  More details including a month-by-month analysis here.
• Many factories have adapted production lines since March to produce personal protective equipment for prevention and handling of COVID-19, including non-medical face masks and medical gowns.
• For further context on the national response to COVID-19, see the ILO’s compilation of country policy responses.

Factory service update 

• Factory visits, including assessments, are suspended, but a risk assessment protocol is in place to allow for BWI to gradually return to on-site advisory factory visits.
• Virtual advisory services are being delivered to 211 factories (653 virtual and 2 on-site advisory visits) with special consideration being given to the need to observe physical distancing, other OSH-related measures and issues related to wages payment as well as industrial relations and operational situation.
• A step-by-step OSH action plan for Better Work factories, to inform and protect workers, has been rolled out using the latest ILO and WHO advice. Factories are instituting temperature screening and social distancing, new handwashing regiments, and are providing masks to workers.
• Virtual trainings have been delivered (in collaboration with government and other experts) on the following thematic areas: Occupational Safety and Health (Certified chemical officer, Certified OSH management system, Certified OSH expert), Labour Norm (Certified labour norm expert training, International Labour Standards), Management System (Root Cause Analysis, PDCA application, Document Control System), Gender and Inclusion (Anti-discrimination, Breastfeeding friendly workplace), Positive Wellbeing in the Workplace/Stress Management, Supervisory skills training with a focus on Leadership during crisis. More topics are currently being developed on Industrial relations, Management systems, OSH and Inclusion thematic areas.
• Virtual Industry Seminars (with the government and other experts) have been delivered on: The impact of the COVID-19 pandemic on the implementation of labour norms, COVID-19 Health and Safety aspects, Annual Festive Bonus (THR), Payment amid the Pandemic, OSH & Labour Norm Aspects, OSH Survey on COVID-19 Protocols in the Workplace.

Additional Better Work Activities

• The Indonesian employers’ associations (Apindo, API and APRISINDO) and trade unions related to export-oriented garment and footwear industries (SPSI, SPSI ATUC, Garteks) signed ajoint commitment to protect health, business sustainability and welfare of workers in these sectors. The joint commitment and action plan outlines the priorities for the sector and the key policy areas that social partners would like to see advanced as response to the crisis by the Indonesian government and international brands sourcing from Indonesia.
• Better Work continues engaging with the provincial governments of West Java, Central Java, Jakarta and central government in clarifying, helping shape and further disseminate policy concerning labour law, PSBB measures and incentive programmes to support workers and employers amid the pandemic.
• Engagement with garment trade unions has been regular, and strategies to further disseminate key information and advice among workers are in place. An Instagram-live campaign has been launched by Better Work for wider sensitization of workers and relevant stakeholders around labour norms, workers’ rights during the pandemics and promoting social dialogue. Some of the sessions focus on strategies to deal with the lockdown, stress and sensitization to avoid the end of Ramadan Mudik (travel back home for Idul-Fitri) and financial literacy. More than 2,000 netizens have viewed, logged in and participated in the IG live sessions. Latest session covered the government’s new arrangement of annual festive bonus (THR), application of new normal in the workplace, social dialogue, preventing layoffs, gender and inclusions.
• Several Covid-19 related thematic webinars have been organized targeting Better Work Buyers including on annual festive bonus (THR); recent developments concerning the West Java’s Minimum Wage 2020 dispute and the newly enacted Omnibus Law.
• Specific Guidance has been issues to deal with the most pressing issues brought about by the Covid-19 pandemic. These include: Guidance on Workers’ Protection and Business Continuity Amid the Covid-19 Pandemic; Transmission, Prevention and Management and the Best Practices in the Workplace and Workers’ Retrenchment Guidelines: A compilation of Q&A when termination is unavoidable. All are available in Bahasa Indonesian and English.
• On 5 October, Indonesia’s Job Creation Bill, or Omnibus Law, was was adopted by the House of Representatives with the opposition of only two political parties. The Law was signed by Indonesia’s president and promulgated, on 2 November, as “Law of the Republic of Indonesia Number 11 of 2020 concerning Job Creation” (Law Number 11/2020). The Employment Cluster of the Law Number 11/2020 is under a “judicial review” by Indonesia’s Constitutional Court, as per the lawsuits filled by several Confederations of Trade Unions, including KSPI, KSPSI and KSBSI. Articles 185 and 186 of Law Number 11 of 2020 stipulates that the Law comes into force on the date of promulgation (2 November) and that the implementing regulations accompanying this law must be issued in a period of three months from that date. Article 185 further states that all related implementing regulations, which have been not be amended by the new law, remain in force.  The job creation cluster of the OL revises the 2003 Manpower Act and introduces significant changes to rules around employment contracts, working hours and leave, wages and termination (among others). A lot is still to be determined in the forthcoming implementing regulations. The law also introduces a new unemployment insurance scheme to protect unemployed workers.