Representatives of workers and management from 30 companies came to an agreement that mutual trust is the key for labour-management cooperation at the enterprise level. The trust has become more important and significant during the COVID-19 pandemic that has adversely affected businesses, jobs and socio-economic activities.

The agreement was achieved through open, interactive dialogues, supported by the ILO in collaboration with the Ministry of Manpower on 2-3 March in MM2100 Industrial Town, Bekasi, West Java and 9-10 March in Cikande, Serang, Banten. In addition to support better labour-management cooperation at the enterprise level, the dialogues also promote improvements of productivity through collective bargaining by jointly finding ways to work more effectively and efficiently.

Based on the report of the World Economic Forum in 2019, the Indonesian productivity index was ranked at 50 out of 141 countries, dropping from 45th rank in 2018. Considering this position, the representative of the Ministry of Manpower, M. Fachrurrozi, Director of Productivity Development, highlighted the important roles of both management and workers in productivity sharing.

“The management will be able to facilitate good labour relations with workers, while trade unions have the role to provide inputs and supports needed to improve the productivity. In addition to good working relations, companies need to have indicator model to measure companies’ productivity, historical baseline to compare working performances and manageable targets,” he said.

Meanwhile, Siti Junaedah, Director of Work Requirements of the Ministry of Manpower, emphasized the importance of productivity that should be responded by bipartite organizations properly as it is closely linked with employers and workers. Thus, productivity-related issues need to be discussed in a comprehensive way and be part of the collective bargaining.

“To discuss about productivity in collective bargaining, both parties need to understand the definitions and basic principles of productivity, to have the same commitment to improve it and to communicate with each other to increase it. The key is a mutual trust and consider productivity as a common goal. When achieved, both parties will definitely enjoy the benefits,” she said.

In agreement, Arun Kumar, ILO’s Collective Bargaining and Social Dialogue Specialist, reminded both parties that workplace productivity does not only improve efficiency and bring down costs of production, but also improve competitiveness of the company as well as increase Value Added (wealth created by factory). These, in turn, lead to higher productivity that create conditions for job security and company capacity to pay higher real wages.

Dissolving barriers for improved productivity

During the dialogues, representatives of management and workers openly discussed their concerns. From the perspective of the management, lack of workers’ motivation and capacity as well as dissatisfaction were the main barriers to the improved productivity. While workers identified lack of transparency, training opportunity and consistent work regulations.

After identifying barriers, both management and workers examined opportunities for improvements. They agreed that productivity could be improved through technological improvements, investments in better machines and maintenance, quality of the inputs, methods and systems improvements, better production lines and improvements in human resources’ policies.

As a conclusion, Arun reminded the participants about the importance of commitment from both parties. “Productive and competitive business requires employees committed to company goals. This requires moving employee relations from ‘conflict and control’ to ‘trust & collaboration’ focused. Management has a major responsibility here to take the lead and adopt policies that promote communication, cooperation and trust between managers, workers and their representatives. Moving towards collaborative industrial relations culture will benefit both company and the workers through its impact on productivity of investments,” he concluded.

As a follow-up, the Manpower Ministry’s Directorate of Productivity Development will organize training activities on the usage of productivity tools, techniques and methods and their application in company’s daily production in early April. Meanwhile, the participating companies are committed to update the way they conduct their collective bargaining by exercising mutual understanding and integrating productivity issues into other work issues.