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28 January, 2008
Global intervention by the ICEM and German affiliate IGBCE resolved a restructuring dispute at Dystar Colours in Indonesia, a manufacturer of disperse dyes used in the textile industry. The dispute started in September 2007, when local managers of Dystar unilaterally implemented job losses on 91 workers out of 500 at the chemicals plant in Gabus, Banten Province.
Worse, managers called a meeting of elected shop-floor leaders of ICEM affiliate FSP-KEP, the Federation of Chemical, Energy, Mine and Gas Workers’ Unions, on 11 September to inform them of the restructuring, but told them to be silent on the sackings.
The 91 job cuts were announced to affected workers on 13 September.
FSP-KEP vehemently objected to the lack of consultation with the labour union over the restructuring, as mandated by Indonesian law. Management responded on 13 September by escorting the 91 sacked workers off company grounds on a bus operated by security guards armed electric stun guns and tear gas. Local police were on standby, as well.
“They were treating workers as enemies, or terrorists, rather than partners in production,” stated FSP-KEP President Sjaiful Patombong, adding managers warned that no severance would be paid unless the union and affected workers adhered to the company’s unilateral plan.
Dystar Colours is German-based and had been 35% owned by Aventis, and 30% each by Bayer and BASF. In 2004, the big American private equity firm, Platinum Equity, purchased the company from the three partners.
FSP-KEP alerted the ICEM over the breach of Indonesian labour law, and the Global Union Federation, in turn, contacted IGBCE. In the meantime, Indonesia’s Ministry of Manpower began conducting meetings between the parties, urging management to comply with the letter and to negotiate with the union.
The result came in mid-January. Although the 91 workers remained off their jobs, they now will receive twice the allowable severance compensation as stipulated by law. They also will receive two times the rate of yearly compensation, an additional four months of pay, and a lump sum Indonesian Rupiah (IDR) totalling 5,000,000.
Through the global intervention, Dystar also agreed to engage FSP-KEP six months in advance in the event of any further restructuring, and agreed to halt the unnecessary intimidation of workers and their union representatives.