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The Rise of Non-Standard Employment in Selected Asean Countries Between Flexibility and Security THE RISE OF NON-STANDARD EMPLOYMENT IN SELECTED ASEAN COUNTRIES Edited by Melisa R. Serrano Between Flexibility and Security: THE RISE OF NON-STANDARD EMPLOYMENT IN SELECTED ASEAN COUNTRIES Between Flexibility and Security: 2 Melisa R. Serrano The Rise of Non-Standard Employment in Selected ASEAN Countries ISBN 978-602-14814-2-4 © 2014 ASEAN Services Employees Trade Unions Council (ASETUC) Jl. Ciujung No. 4 Jakarta Pusat 10150 Indonesia Tel. +62 (0)21 7193 711 Fax +62 (0)21 7179 1358 Research Team: Melisa R. Serrano Mary Leian C. Marasigan Vera Eileen V. Pupos Copy Editing: Leong Wen Shan Layout and Printing: Xpress Print The findings, interpretations, and conclusions expressed in this publication are entirely those of the author(s); they do not necessarily represent the views of Friedrich-Ebert-Stiftung (FES) and the ASEAN Services Employees Trade Unions Council (ASETUC). Individual authors are also responsible for the accuracy of facts and figures presented in this volume, which are published in good faith by FES and ASETUC. Foreword Since 2007, the ASEAN Services Employees Trade Unions Council (ASETUC) and its member unions affiliated to the Global Union Federations of Building and Wood Workers’ International (BWI), Public Services International (PSI) and UNI Global Union (UNI) have come together to contribute towards the building of the ASEAN Community. According to the ASEAN Socio-Cultural Community Blueprint from 2009, this was to be forged by an “enduring solidarity and unity” among the working people of ASEAN so as to realise an “inclusive and harmonious society where the well-being, livelihood and welfare of people are enhanced.” We believe that trade unions, as a social partner in labour relations, have an important role in promoting a sustainable and equitable ASEAN regional economy that enjoys shared prosperity for all. Friedrich-Ebert-Stiftung (FES) shares the values of ASETUC, that strengthening the social dimension of the ASEAN integration process is crucial for its success. To build a people-oriented and socially responsible community entails taking into account the principles of the Decent Work Agenda proposed by the International Labour Organization. For FES, as an organisation committed to the values of social democracy, trade unions and the labour movement in the region play a crucial role in shaping the future of ASEAN societies in a socially just way with decent working conditions for all workers. This publication, with the support of FES, is one of the many initiatives of ASETUC to develop better knowledge and understanding of the labour market and conditions in ASEAN. It was undertaken as a response from workers and trade unions who have expressed their collective concerns over the growing trend of precarious and other forms of non-standard work arrangements. These trends in the world of work have brought about numerous implications to the lives of working people with regard to access to social security, workplace entitlements and benefits, career progression and development, as well as decisions in the private sphere. At the root of workers’ and unions’ concerns is a growing feeling of insecurity, given that work organisation and employment are increasingly flexible and a large majority of workers are placed outside the responsibilities of the principal company and the protection of employment legislations. Until today, labour laws in many countries have yet to adequately address these developments on the labour market and employment relations, and their enforcement remain to be improved. Between Flexibility and Security: ii Melisa R. Serrano The Rise of Non-Standard Employment in Selected ASEAN Countries Hence, this publication aims to map out the various types of non-standard forms of employment in six selected ASEAN countries, and to explain how their trends increase insecurity. In addition to the data and information that was made available, the publication also provides insights to the employers’ or employment agencies’ perspectives on the increasing trends of non-regular forms of employment. The publication also highlights “good practices” that are able to reconcile the need of workers for employment security and the employers’ need for a flexible workforce. We would like to thank Mary Leian C. Marasigan, Vera Eileen V. Pupos, co-authors of this publication and especially, Dr Melisa R. Serrano for being the lead author and editor. While this publication is intended for deliberations within ASETUC and its affiliates, we hope that the general public, academia and policymakers alike will find this publication to be of use for advancing the debate surrounding the evolving labour market and its impact on labour relations and conditions. We welcome your feedback and comments at [email protected] or julia.mueller@ fes-asia.org Mohamed Shafie BP Mammal Julia Mueller General Secretary Director ASEAN Services Employees Friedrich-Ebert-Stiftung (FES) Trade Unions Council (ASETUC) Office for Regional Cooperation in Asia Between Flexibility and Security: The Rise of Non-Standard Employment in Selected ASEAN Countries iii Acknowledgements This book is a product of the research project “Non-standard Forms of Employment in Selected ASEAN Countries” commissioned to the authors by the Friedrich-Ebert- Stiftung (FES), Office for Regional Cooperation in Asia, and the ASEAN Services Employees Trade Unions Council (ASETUC). The research was undertaken from May to October 2013. We gratefully acknowledge the funding support we received from FES. We particularly thank Julia Mueller, Director of the FES Office for Regional Cooperation in Asia. Also, we especially thank André Edelhoff, former Programme Manager for Social Dialogue and Trade Unions, for providing overall technical direction to the project while he was still with FES. Many thanks too to Lukas Bauer, the new FES Programme Manager on Social Dialogue and Trade Unions, for taking up where André left off. Special thanks also to the FES offices in Indonesia, Malaysia, the Philippines, Singapore, Thailand and Viet Nam for arranging our accommodation and addressing other logistical needs of the project and our field visits. We are equally grateful to ASETUC, particularly Magdalene Kong, for arranging our field visits and interviews in Indonesia, Malaysia, Singapore, Thailand and Viet Nam. We also thank Magdalene for her careful and patient review of the extensive draft research report and for her invaluable comments. The key findings of our research were presented by this book’s lead author, Melisa R. Serrano, in the FES International Trade Union Conference “Fair Instead of Precarious — Trade Union Strategies for Decent Work Worldwide” on 11–12 March 2014 in Berlin, Germany. We thank Julia for providing us the opportunity to present the findings of our research. We also thank the participants of the conference who commented on the presentation. Finally, we thank all the persons we interviewed in the six study countries for their generous time and for the important information and valuable insights they shared with us. These persons are named in the chapters of this book. Melisa R. Serrano Mary Leian C. Marasigan Vera Eileen V. Pupos Between Flexibility and Security: iv Melisa R. Serrano The Rise of Non-Standard Employment in Selected ASEAN Countries Contents Foreword i Acknowledgements iii List of tables, figures and boxes vii List of acronyms vii Executive summary 1 Introduction 7 1 From standard to non-standard employment: 9 The changing patterns of work Melisa R. Serrano Flexible workplace, flexible workforce 12 Key features of non-standard employment in the service sector 15 The rise of temporary agency work 17 Defining temporary agency work 17 The triangular employment relationship in agency work 20 ILO Convention 181 and temporary agency work 21 Common views of global unions on temporary work agencies 23 Conclusion 26 2 Indonesia 29 Mary Leian C. Marasigan and Melisa R. Serrano Economic growth and the labour market 30 Non-standard and fixed-term employment in Indonesia 33 GDP growth, employment and precarious work 35 Unionisation trends 36 The legal definition of fixed-term employment 38 Job outsourcing and labour outsourcing (labour supply) 40 Multiple interpretations on outsourcing 43 Positioning fixed-term workers in outsourced work 44 Employers’ perspective 46 KSPI’s experiences among contract and outsourced workers 46 Union strategies of joint, inter-union collaborations 48 Organising contract and outsourced workers 49 Conclusion 50 Between Flexibility and Security: The Rise of Non-Standard Employment in Selected ASEAN Countries v 3 Malaysia 55 Melisa R. Serrano Economic growth and the labour market 56 Unionisation trends 59 The magnitude of non-standard employment 60 The legal framework on non-standard employment 62 Outsourcing practices in Malaysia: Employers’ perspective 63 Outsourcing and agency-hiring practices: Unions’ perspective 65 Union initiatives organising outsourced and agency-hired workers 66 Conclusion 68 4 Philippines 71 Mary Leian C. Marasigan and Melisa R. Serrano Economic growth and the labour market 72 GDP growth and non-regular employment 73 Unionisation trends 75 Categories of non-regular employment 78 The legal framework of non-regular work 79 Service or labour contracting 80 The magnitude of non-regular/non-standard employment 84 Trends in outsourcing and agency-hired work 87 Operations of private employment agencies 91 Trade unions’ perspective on non-standard work 95 Layered efforts to ‘regulate’
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