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Promoting Decent Work for All

Promoting Decent Work for All. INDUSTRIAL DISPUTE RESOLUTION CONFERENCE INTERNATIONAL PERSPECTIVES 3 October 2007 Melbourne “Industrial Dispute Resolution in ASEAN Countries: Some Recent Developments”. Alan Boulton, Director ILO Jakarta Office. 1. Promoting Decent Work for All.

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Promoting Decent Work for All

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  1. Promoting Decent Work for All INDUSTRIAL DISPUTE RESOLUTION CONFERENCE INTERNATIONAL PERSPECTIVES 3 October 2007 Melbourne “Industrial Dispute Resolution in ASEAN Countries: Some Recent Developments” Alan Boulton, Director ILO Jakarta Office 1

  2. Promoting Decent Work for All • ASSOCIATION OF SOUTHEAST ASIAN NATIONS • Brunei, Cambodia, Indonesia, Lao PDR, Malaysia, Myanmar, Singapore, Philippines, Vietnam • 560 million people, labour force 282 million • Wide differences in member countries (wealth, development, Government systems, etc) • Major changes in recent years (new members – Vietnam 1995, Lao PDR & Myanmar 1997, and Cambodia 1999; financial crisis; market economy; democracy; competition from China and India, etc) 2

  3. Promoting Decent Work for All • RECENT LABOUR MARKET TRENDS IN ASEAN COUNTRIES • Average annual GDP growth between 2000-2006 was 5.7 per cent (Cambodia 8.6%, Vietnam 7.7% cf. China 9.9% and India 7.2%) • Between 2000 to 2006, labour force increased by 35.8 million or 13.5 per cent (Cambodia 52.8%, Philippines 20%, Indonesia 11%, Singapore & Thailand  9%) • Many workers in export-oriented industries • Healthy productivity growth in ASEAN linked to sectoral shift from agriculture to industry & services • Informal economy has remained massive, about 60 per cent of ASEAN workforce 2006 (Cambodia & Vietnam 80%, Indonesia 60%, Thailand 53% and Singapore 8.8%) 3

  4. Promoting Decent Work for All • SNAPSHOT: ASEAN’S 282 MILLION WORKERS • If ASEAN’s labour force (ages 15+) consists of • 100 workers … • 58 are men and 42 are women • 47 work in agriculture; 35 in services; 18 in industry • 7 are unemployed • 59 work in the informal economy • 11 live on less than US$1 per day • 57 live on less than US$2 per day 4

  5. Promoting Decent Work for All • MODERNIZING INDUSTRIAL RELATIONS (1) … Many developing countries in Asia are improving industrial dispute resolution as part of the modernization of their industrial relations systems Examples include: • Cambodia – the establishment of the tripartite Arbitration Council in 2003; • Indonesia – new Industrial Relations Disputes Settlement Act 2004 and the establishment of the Industrial Relations Court; • Viet Nam & China – steps towards developing new dispute resolution frameworks 5

  6. Promoting Decent Work for All • MODERNIZING INDUSTRIAL RELATIONS (2) … • A fair and effective system of industrial dispute • resolution is a pre-requisite for growth and development • Existing systems deficient or unacceptable in new economic and social environment • Concern about rising tide of labour disputes • Recognition of democratic and labour rights • Concern about investment flows and market access 6

  7. Promoting Decent Work for All • MODERNIZING INDUSTRIAL RELATIONS (3) … • Particular challenges faced by developing countries in modernizing industrial relations • Background of government intervention • Adaptation of practices in industrialized countries • Institutional weaknesses (government, employers and workers) • Concern about social and political unrest 7

  8. Promoting Decent Work for All • MODERNIZING INDUSTRIAL RELATIONS (4) … • Key issues relate to freedom of association and freedom of collective bargaining • Only 4 ASEAN countries have ratified C87 on freedom of association • Workers’ organizations are either under government influence or fragmented with little strength • Limited experience with and scope for collective bargaining • Many disputes about “rights” 8

  9. Promoting Decent Work for All RATIFICATION OF ILO FUNDAMENTAL CONVENTIONS * Malaysia and Singapore ratified Convention No. 105 in years as indicated above, but later denounced their ratification of the Convention. Forced Labour Convention, 1930 (No.29); Freedom of Association and Protection of Right to Organize Convention, 1948 (No. 87); Right to Organize and Collective Bargaining Convention, 1949 (No. 98); Equal Remuneration Convention, 1951 (No. 100); Abolition of Forced Labour Convention, 1957 (No. 105); Discrimination (Employment and Occupation) Convention, 1958 (No. 111); Minimum Age Convention, 1973 (No. 138); Worst Forms of Child Labour Convention, 1999 (No. 182) 9

  10. Promoting Decent Work for All INDONESIA – SOME BASIC FACTS Population: 220 million GDP growth: 5.5% (2006) Inflation (CPI): 6.01% (May 2007) Labour force: 110 million (2006) Open unemployment: 10.4% (2006) Formal/informal: 63.8% of those employed work in the informal/traditional economy (2006) Wages (2007): DKI Jakarta Rp.900,560 (US$98 per month) Bali Rp.622,000 (US$68 per month) North Sumatra Rp.761,000 (US$83 per month) 10

  11. Promoting Decent Work for All THE INDONESIAN EXPERIENCE (1) … • Some remarkable progress since 1998 • In democracy • In recovery from economic crisis • In labour law reforms 11

  12. Promoting Decent Work for All • THE INDONESIAN EXPERIENCE (2) … • Ratification of ILO Conventions • C.87 Freedom of Association (1998) • C.105 Forced Labour (1999) • C.138 and 182 Child Labour (1999 and 2000) • C.111 Discrimination in Employment (1999) • New Labour Laws • Trade Union Act 2000 • Manpower Act 2003 • Industrial Disputes Settlement Act 2004 • Migrant Workers Act 2004 Unions • 90 national federations of trade unions (September 2006) • 11,444 trade unions at plant level (September 2006) • Total membership 3.39 million workers (2006) 12

  13. Promoting Decent Work for All THE INDONESIAN EXPERIENCE (3) … Potential for labour disputes…

  14. Promoting Decent Work for All THE INDONESIAN EXPERIENCE (4) … • Industrial Relations Disputes Settlement Act 2004 • Emphasis on bipartite settlement • Mediation by government mediators • Access to private conciliation and arbitration • New Industrial Relations Court at Supreme Court and District Court level 14

  15. Promoting Decent Work for All THE INDONESIAN EXPERIENCE (5) … • Features of new system • Continued use of government mediators under regional autonomy • Industrial Relations Court comprised of panel of judges (career judge sits with ad-hoc judges from employers & unions) • Court has jurisdiction to adjudicate on “rights” and “interests” disputes 15

  16. Promoting Decent Work for All THE INDONESIAN EXPERIENCE (6) … • Experience with new system • Most disputes settled at enterprise level or with assistance of mediators • Little use of private conciliation and arbitration • Problems with start up of new Court (appointments, resources, training) • Significant number of cases at Supreme Court: 213 cases in 2006 and 584 cases to August 2007 • Some disputes involve informal mechanisms (e.g. Ministerial intervention; parliament; police; etc) 16

  17. Promoting Decent Work for All THE INDONESIAN EXPERIENCE (7) … Some statistics Strikes Labour Disputes *As of October 2005 ** Labour disputes are disputes over normative and non-normative rights such as wages, overtime, bonus, trade union, transport and meal allowances, uniform, employment status, etc. 17

  18. Promoting Decent Work for All THE INDONESIAN EXPERIENCE (8) … Dispute Settlement Officials (September 2007) 18

  19. Promoting Decent Work for All THE INDONESIAN EXPERIENCE (9) … • Some challenges • Understanding of collective bargaining and new system • Support through labour administration (e.g. inspection and mediation services) • Problems in establishing new institution (including issues relating to jurisdiction, workload, expertise and practice of courts) • Proper role for police 19

  20. Promoting Decent Work for All THE INDONESIAN EXPERIENCE (10) … The ILO has assisted the labour law reform process and the operation of the new industrial relations system mainly through two projects: ILO/USA Declaration Industrial Relations Project ILO/USA Declaration Police Training Project 20

  21. Promoting Decent Work for All THE INDONESIAN EXPERIENCE (11) … • Some specific needs identified • Promotion of bipartite cooperation and dispute settlement • Improved inspection and mediation services • Training (parties, mediators, judges) 21

  22. Promoting Decent Work for All • IMPROVING DISPUTE RESOLUTION IN ASEAN COUNTRIES (1) … Indonesia’s experience in introducing new dispute resolution system highlights some of the challenges in developing countries in Asia: • Experimentation with new institutions (Cambodia, Indonesia) within model of government mediation services and adjudication by independent body • Weakness in labour administration and capacity of parties • Building and maintaining respect for new institutions (e.g. Philippines) • Promoting labour management cooperation and an understanding of collective bargaining • Defining the role of government and police in new system • Part of process of promoting harmonious industrial relations and labour management cooperation to enhance competitiveness and attract investment 22

  23. Promoting Decent Work for All • IMPROVING DISPUTE RESOLUTION IN ASEAN COUNTRIES (2) … • CAMBODIA • Arbitration Council established in 2003 as independent Forum for resolution of labour disputes • Tripartite structure with cases determined by a panel of 3 arbitrators (from government, employers and unions) selected by the parties • Collective labour disputes not resolved by a conciliator from the Ministry of Labour are forwarded to Arbitration Council • Arbitration Council can resolve “rights” or “interests” disputes through voluntary mediation and mandatory arbitration • Parties may opt for binding or non-binding arbitration • Estimated 68% of cases resolved through pre-arbitral mediation or through arbitral awards • ILO/USA/NZ Labour Dispute Resolution Project assisted with the establishment of the Arbitration Council 23

  24. Promoting Decent Work for All • IMPROVING DISPUTE RESOLUTION IN ASEAN COUNTRIES (3) … • VIETNAM (1) … • Significant number of wildcat strikes in recent years, especially in • foreign-invested enterprises • 1995 Labour Code created new legal framework of industrial • relations (socialist market economy) • Labour Code grants right to strike & each enterprise has • its own union, although all affiliated to Vietnam Confederation • of Labour. • Mechanism for dispute resolution under the Code is by • enterprise-level Conciliation Council with recourse to provincial level • Labour Arbitration Council. However, once dispute or strike happens • a joint task force of local Department of Labour officials and • provincial union officials visit the factory and mediate the dispute. 24

  25. Promoting Decent Work for All • IMPROVING DISPUTE RESOLUTION IN ASEAN COUNTRIES (3) … • VIETNAM (2) … • Pressure to reform and improve current dispute settlement system • with revisions to Labour Code Chapter 14 on Settlement of Labour • Disputes in 2006 • Consideration of role for local mediators (not government officials?) • and workers’ and employers’ representatives in Arbitration Council • ILO/Norway Industrial Relations Project; ILO Factory Improvement • Project 25

  26. Promoting Decent Work for All • IMPROVING DISPUTE RESOLUTION IN ASEAN COUNTRIES (4) … • ASEAN Community is • Sharing experiences between countries, especially those • with more developed systems (Singapore, Malaysia) • ASEAN Labour Ministers have established a Working Party to • promote better industrial relations and progressive labour practices 26

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