Bipartite Dispute Resolution in Legislation

Provisions regarding bipartite dispute resolution are set out in article 3 of Law number 2 of 2004 on Industrial Relations Dispute Settlement and its implementing regulation from the Ministry of Manpower and Transmigration number PER.31/MEN/XII/2008 on Guidelines for Industrial Relations Dispute Settlement through Bipartite Negotiation.

Stages of Bipartite Dispute Resolution

Generally the bipartite dispute resolution can be divided into three stages:

Stage 1: preparation stage before negotiations start

In this stage the aggrieved party should take the initiative to communicate to the other party regarding its intention to resolve the dispute through negotiations. The parties also appoint their representatives for the negotiations. Employers must handle the dispute directly and employees may provide a proxy to the labor union to accompany them in the negotiations.

Stage 2: negotiation stage

In the negotiation stage the parties in dispute first have to identify and inventorize all problems which lead to the dispute between the parties. Based on that the parties will draft a Code of Conduct (tata tertib) for the bipartite negotiations and the timetable for negotiations. The negotiations between the parties are performed in accordance with the aforementioned documents. For each time the parties meet to negotiate the dispute meeting minutes (risalah) must be prepared, which must be signed by both parties.

Generally the bipartite negotiations take maximum 30 working days. However the parties in dispute may agree to extend such period. The legislation does not set a time limit to such extension.

Stage 3: post negotiation stage

This stage encompasses the handling of the result of bipartite negotiations as follows:

1. in case the parties reach an agreement, then a Collective Agreement is made which is signed by the parties and registered in the Industrial Relations Court in the District Court;

2. if the negotiations fail then one or both parties record the dispute to the government agency, by attaching evidence that remedies through bipartite negotiations have been conducted.

This column is provided by PNB Law Firm Jakarta