Oil palm covers more than 86,000 ha of land in Aceh Tamiang Regency, according to 2017 numbers from Statistics Indonesia. As one of the largest agricultural sectors in Aceh Tamiang, it provides jobs for thousands of locals. At the same time, the crop is linked to environmental and labour challenges.

To address the latter, about 66 people from businesses, civil society and government attended a training workshop at the BAPPEDA auditorium, Aceh Tamiang, Indonesia on August 6 and 7, 2019. The session was aimed at helping palm oil mills and plantations, and their workers’ unions, establish Collective Bargaining Agreements (CBAs) – known locally as Perjanjian Kerja Bersama (PKB). CBAs can be an effective means for companies and workers’ representatives to ensure good working conditions for employees, contributing to improved productivity as well.

The workshop was organised by the Government of Aceh Tamiang Regency with support from Earthworm Foundation. It was the first such training conducted with management and workers’ representatives in the region’s palm oil space.

“The idea was to support the area’s ‘Taskforce for Acceleration of Green Development’ (Tim Percepatan Pembangunan Hijau),” said Rikto, from Earthworm’s Strategic Outreach team in Indonesia.

About 26 palm oil suppliers, including plantations and mills, attended along with local NGOs and government officials. The workshop covered the benefits, legal requirements and implementation of a Collective Bargaining Agreement.

This initiative is led by the Bupati (district government) of Aceh Tamiang and is a partnership between local government, NGOs and related stakeholders to promote sustainable development, defined by good environmental and social practices, in Aceh Tamiang.

The morning of the first day saw four panellists from the government, businesses and unions talk about benefits and challenges of having a CBA. In the afternoon, a local NGO shared their experience with casual workers in a union they set up. In Indonesia, casual workers – who are supposed to work only three months a year – are rarely formally represented, due to their temporary status.

“It’s challenging for unions to have them as members because of this uncertainty,” said Lisnawati, Programme Officer for Earthworm’s Respect programme in Indonesia. “As they are temporary, casual workers also earn lower wages. This can make it difficult for them to afford union membership fees.”

The second day also saw a simulated negotiation process, where participants were split into groups representing companies and unions. They then began a series of discussions around employment contracts, working hours, social benefits and insurance, and wages. Participants were also taken through the nitty-gritty legal aspects of a CBA.

The session ended with groups taking back lessons on how they can implement a CBA in their operations. The government and Earthworm will help two companies develop such CBAs, thus creating case studies for others to follow.

From the companies that participated, three currently have CBAs. Through this training, EF and its government and industry partners hope that more palm oil companies will develop CBAs to better protect workers and provide stability to businesses.

For businesses with trade unions, Collective Bargaining Agreements are mandated by Indonesian law. While internationally, the global market asks for CBAs as part of sustainable palm oil policies and certification initiatives.

“The challenge for companies is lack of awareness on labour regulations, and on CBA regulations in particular,” said Arif Purwanto, Labour Expert at Earthworm Foundation in Indonesia. “Also, there were concerns that failure to reach an agreement would create tensions with workers.”

This latest workshop represents a continuation of our Landscapes work, APT (Areal Prioritas Transformasi), which started with a 2018 MOU (Memorandum Of Understanding) with the regional government. In light of this agreement, the government and Earthworm organised its first workshop back in December 2018 to understand labour challenges. Five priority topics were uncovered – minimum wage, contracts, social security, collective bargaining and occupation safety – which paved the way for our work in this latest workshop.

“We have learned meaningful lessons, which we previously didn’t know,” said a participant from PT. PMKS Pati Sari. “Now we know how to create harmony between us workers and the company. We hope that these trainings will continue, so that both workers and employers benefit.”