Workers battle Nestle straitjacket on union rights

A visit to Indonesia by ten members of the Food Industry Employees Union (FIEU) in Malaysia has helped expose Nestle Indonesia management’s refusal to respect some core trade union rights at its factory in Panjang. The visit in mid-June culminated in a protest action in front of the factory.

For two years the Nestle Indonesia Workers Union - Panjang has campaigned for the right to negotiate wages and to have the pay scale included in the collective agreement. But Nestle Indonesia management has refused, disregarding ILO documents and guidelines of the Organization for Economic Cooperation and Development, responding with pressure on union members and their families.

The Indonesia situation contrasts with that in Malaysia. FIEU, which is affiliated to the International Union of Food, Agricultural, Hotel, Restaurant, Catering, Tobacco and Allied Workers’ Associations (IUF) negotiates with Nestle Malaysia on behalf of its 2,200 members. The Nestle Malaysia collective agreement includes a detailed wages table, which the union in Indonesia has been demanding. Nestle Indonesia management claims the wages table is a ‘company secret’, despite the fact it is clearly not so elsewhere, including in Malaysia.

FIEU president Muhammad Zelan bin Harun pointed out that Nestle Panjang factory boasts international ‘best practice’ and exports 75% of its Nescafe products. Yet when it comes to trade union rights, it fails to apply international best practice.

Malaysian union’s solidarity visit to Nestle workers in Indonesia          Photo: IUF

Moreover, Nestle’s reluctance to ensure full rights for the union in Indonesia comes as the company has been unveiling massive expansion plans in Southeast Asia. Nestle announced on 13 June 2009 that it would invest 240 million US dollars in the region this year, including in Indonesia. However, a third of the amount would go towards building a pet-food plant in Thailand, adding 145 jobs.

In 2008, Nestle’s business in the region saw a 15% organic growth and the company is expecting good growth in all Southeast Asian countries, its executive vice president Frits Van Dijk said on 14 June.

Sources: IUF.org, 22 June 2009; Wall Street Journal, 13 June 2009; The Nation, 9 June 2009; New Sabah Times, 15 June 2009