Press Release: PT Smelting Workers’ Rights Denied Following A Negotiation Deadlock

Lokataru Law and Human Rights Office (“Lokataru”) as the attorney of Pimpinan Unit Kerja Serikat Pekerja Logam Federasi Serikat Pekerja Metal Indonesia (“PUK SPL FSPMI”) urges PT Smelting to fully guarantee the workers’ rights in conformity with the prevailing labor laws and regulations. Lokataru deeply regrets PT Smelting’s violation of workers’ rights, among others, the company’s failure to pay its workers’ Health Social Security Administering Bodies (“BPJS Kesehatan”) and Employment Social Security Administering Bodies (“BPJS Ketenagakerjaan”) premiums. 

PT Smelting is the first copper Smelter Company in Indonesia with Mitsubishi Materials Corporation and Mitsubishi Corporation RTM Japan Ltd., as one of its shareholders. During the negotiation of the Collective Labor Agreement No. 8 (“CLA 8”) between PUK SPL FSPMI and PT Smelting from November 28, 2016, to January 6, 2017, both parties did not reach an agreement. As a result, PUK SPL FSPMI carried out a strike which was conducted legally, orderly, and peacefully by informing Gresik Manpower Office (“Disnaker”) and PT Smelting through a written notification.

Subsequently, PT Smelting unfairly dismissed the workers who participated in the strike by issuing Notice of Termination of Employment and alleged such workers to have resigned. Since then, the company did not register workers at BPJS Kesehatan insurance. This situation was exacerbated by PT Smelting’s request to deactivate BPJS Ketenagakerjaan membership.  

As a result, 307 of PT Smelting’s were unable to access their BPJS Kesehatan and Ketenagakerjaan due to PT Smelting requests to the administering bodies since the beginning of March 2017. Not only refusing the workers’ health and social insurance rights, PT Smelting did not make a claim to the designated insurance company, namely PT Tri Pakarta Insurance as a result of layoffs after the Supreme Court Verdict No. 388K /Pdt.Sus-PHI/2018 dated May 23, 2018, in conjunction with Industrial Court Relations Verdict No. 16/ Pdt.Sus-PHI/2017/PN.Gsk dated December 11, 2017. Accordingly, PT Smelting shall be subjected to administrative or criminal sanctions. 

For these reasons, Lokataru has taken few steps, among others, issuing a legal warning to PT Smelting and requesting a bipartite invitation, requesting Industrial Relation Dispute Registration to the Director of Industrial Relations Dispute Prevention and Resolution (PPHI) of the Ministry of Labour of the Republic of Indonesia, which was continued with a clarification agenda and to the Labour Office of the Gresik Regency and had mediated with BPJS Kesehatan Gresik. However, such steps prove to be futile as these parties argued that the working relationship between PT Smelting employees and PT Smelting had ended since Supreme Court Verdict No. 388K /Pdt.Sus-PHI /2018, ultimately giving no solution to the employment dispute experienced by our clients.

Under the on-going legal and non-legal remedies, we call on Mitsubishi Materials Corporation and Mitsubishi Corporation RTM Japan Ltd, as the majority shareholders of PT Smelting to participate and urge the settlement of PT Smelting labor disputes with its and former employees whose rights have not been fulfilled to this date.