Sri Sayekti, 55 years old, had to swallow a bitter pill on 20 September last year. On that day, the factory she worked for 27 years had just let her go after being furloughed for six months prior to the announcement.

She only received a severance pay of Rp 6.5 million (US$453.95) “due to the coronavirus”, much lower than what she deserved for working almost three decades in the garment factory located in Ungaran, Central Java. “We have tried to protest against it but failed. We rejected it at first, but what can we do?” told Sri.

Yet, she was grateful with the compensation fund programme under the ILO’s German Federal Ministry of Economic Cooperation and Development (ILO-BMZ). The programme has offered a direct compensation of Rp 1.2 million (US$90) for garment workers who have lost their jobs between March 2020 and May 2021.

Just like Sri, a former factory worker Ratna Widiastuti said she was thankful for the fund. She used it to buy COVID-19 treatments and healthy food as the virus had infected Ratna and her family.

Sri and Ratna were among 20,000 workers left unemployed by the pandemic who benefited from the compensation programme. The ILO-BMZ programme, in collaboration with Better Work Indonesia (BWI) —a partnership programme between the ILO and the International Finance Corporation (IFC)—have distributed a total of USD1,7 million of compensation fund.

Sri used the money to rebuild her life by taking sewing courses since last October. She has received orders to sew shirts and skirts. She plans to improve her skills learning how to sew trousers and Indonesian traditional blouse-dress, kebaya.

“I’m happy and grateful. Alhamdullilah (Thank God), to receive the help,” she said, hoping that her skills will help her start a sewing business at home to pay for her children’s education.

Meanwhile, Ratna who had to resign from her job last November due to health concern is now helping her husband to run a kiosk that sells basic necessities. “When we received the fund, we were all sick and we were really helped by it. We did not need to use the money from the kiosk,” she recalled.

BWI programme recorded 22,840 workers in garment industry have lost their jobs since the start of the pandemic in the garment industry. Maria Vasquez, BWI’s Chief of Technical Advisor, cited a BWI survey between March and May 2020 showing that around 70 percent of 216 BWI member factories closed for less than one month. The survey also found that 28 percent of them saw reduced or held existing orders, while others reported cancelling orders or lacked raw materials needed for production.

“Mobility restrictions enforced domestically and globally have hit the garment industry hard, with the industry being heavily reliant on imported raw materials and export markets,” stated Maria.

Dedi Syaifullah, a human resource manager at a factory in West Java, witnessed such an impact. He said the number of orders nosedived by 50 to 60 percent between May and June of 2020 compared to the previous year.

These conditions forced the company to discontinue the contract of around 350 employees who had worked for less than a year and whose contract had ended during the period. Such layoffs reduced the factory’s capacity to 40 percent.

Although a year later, the company managed to double its capacity to 80 percent by accepting every incoming order regardless of its profitability, the factory has yet to absorb around 100 former employees through the increase. “The compensation fund programme was very helpful, especially for those 100 people. The programme helps the workers to survive the pandemic after a year being laid off,” exclaimed Dedi.

Better Work Indonesia (BWI)
Better Work Indonesia is a partnership between the International Labour Organization (ILO) and the International Finance Corporation (IFC). The programme aims to improve compliance with labour standards and promote competitiveness in global supply chains.

ILO-BMZ Project
The ILO’s Occupational Safety and Health and Income Support in response to the COVID-19 Pandemic Project, funded the Germany’s Federal Ministry for Economic Cooperation and Development (BMZ), aims to strengthening OSH measures to facilitate return to work in acceptable conditions of safety and health after COVID 19 lockdown, particularly in garment sector.