The Patra Jasa Saga

(8/5/2002)

Over 200 former employees of Bali's Patra Jasa Resort gathered outside the office of the Province's Governor on Wednesday, July 31, 2002, in the latest chapter of a continuing labor dispute with the hotel's management.

The labor confrontation began in April of 2001, when 240 employees of the company objected to the corporate job rotation of the hotel's then General Manager, Mr. Jasa Purba, by staging a wild cat walk-out action. Insisting that the appointment of senior management was their exclusive prerogative, the owners gave an ultimatum to those participating in the illegal strike action: return to work and sign a company loyalty statement or be permanently terminated from the positions.

Eventually the 240 employees staging a sit in at the hotel's entrance were advised by a letter dated May 02, 2001 that their status as employees of the Patra Jasa had come to an end.

In response, the affected workers claimed that under Indonesian law their employment could only be terminated following a mediated bi-lateral negotiation process and appealed their dismissal through the courts. Later, the workers were told by the courts that the company, as a State-owned enterprise of the State Oil Company - Pertamina, was exempt from the mandatory termination negotiation provision of the labor law.

Still undeterred, the employees then sought the support of members of the local Provincial Parliament and the Governor's office, seeking to force the Resort to return them to their former positions. In June, during a meeting between the Governor's office and the dismissed employees without the participation of the Resort's Management, the workers were promised by local politicians that they would definitely receive their jobs back. Seeking to force the Hotel Owner's hand, all the operating licenses of the resort were audited with the Governor's office threatened to close the property if any permits were found not to be in order, saying they would also refuse to extend any permits coming up for renewal unless the affected workers were re-employed.

Check and Check Mate? Apparently Not.

The Governor's Office, finding the Resort's paperwork in order, feared that in issuing the threat they may have exceeded their legal authority. Moreover, because reactions from the business community in Bali indicated that the Governor's Office intervention in labor cases could sabotage efforts to encourage investment in the region - the Governor's office eventually back-tracked on their promises to the workers, admitting it was powerless to force their striking workers' re-employment.

Meanwhile the Resort, insisting that refusing to return to work when originally ordered to do constituted resignation from their posts, sent a letter to the Governor on July 29, 2002, advising that all the deserted positions had been filled over the intervening 14 months by new staff and that the company was only committed to pay the legally mandated severance benefits to staff applying for benefits through the local Department of Manpower and the Administrative court system.

Of the 240 terminated employees, 37 have already accepted the severance package offered by the hotel. Labor regulations for terminated workers allow for between 11 and 43 times the final monthly salary and benefit package, depending on the length of service with the hotel.

The Patra Jasa Resort continues to operate while undergoing a massive renovation of its public areas and rooms, expected to be completed in November of this year.