Shaping a social dialogue culture for more sustainable palm oil

Sustainable palm oil initiatives exist to address environmental and social issues such as exploitation  in the palm oil industry. In particular, labour issues such as wages, the welfare of women workers, child labour, and workers’ safety, are at the forefront. Providing a space where union representatives can discuss core issues with companies and government officials is an effective method and a key part of the process to improve the labour situation.

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The Siak-Pelalawan Landscape Programme (SPLP) and CNV Internationaal have been establishing social dialogue as a space for this discussion to achieve sustainable palm oil in Siak and Pelalawan, Riau, Indonesia. Social dialogue includes the exchanges of information, consultation, negotiation, and dispute settlement, with the aim to create and maintain a platform for discussions between the government and palm oil companies and workers’ unions.

“Social dialogue is not an objective in itself; it is a process. SPLP and CNV Internationaal facilitate social dialogue as part of the Siak-Pelalawan Landscape Programme, to establish discussions as a habit and to prevent conflicts in the future,” says Samuel Gultom, Strategic Advisor and Fundraiser for Asia, CNV Internationaal.

Gultom also explains that social dialogue was previously known in industrial relations as collective bargaining. Although the term collective bargaining is still used, now the term social dialogue, which can involve more parties than just the social partners in collective bargaining, is more prominent.

Advancing labour rights to achieve sustainability

SPLP, facilitated by Proforest and Daemeter, is a sustainable palm oil initiative driven by palm oil supply chain  and civil society actors with one of its core pillars being labour rights. In the Siak and Pelalawan districts in Riau, the majority of the community work in the palm oil sector that dominates these areas. Despite being one of the most economically important sectors, there are still various labour issues in palm oil, which hinder the full implementation of sustainability commitments.

Getting to the bottom of labour issues in the palm oil sector is consistent with the law and with company policies. As regulated in Indonesian Manpower Law (Law No. 13 of 2003), companies that employ 50 employees or more should establish a bipartite cooperation institution or LKS Bipartite. This institution is a communication and consultation forum on industrial relations issues. Furthermore, more than 170 palm oil companies in Indonesia have made pledges to eliminate deforestation and other negative environmental and social impacts from their supply chains in mills where the palm oil gets planted and harvested by the workers.

Intan Ningsih, landscape programme manager at Proforest, elaborates on the programme’s approach. “We incorporated social dialogue into our strategy from the very beginning of the landscape programme. There are many overlapping supply bases in Siak and Pelalawan from which eight companies source materials. Moreover, some protected areas, such as peatland that sequesters carbon and a national park, are nested within these districts, adding to the area’s vulnerability. Hence, Siak and Pelalawan are strategic areas to achieve sustainable palm oil.”

Gultom delves further into the strategy. “We are focused on the system already in place within the landscape. Our programme does not target individual actors but explores actions and initiatives that already exist within the landscape. As a result, we have been able to incorporate other government agencies into the discussions, such as the plantation office or women’s and children’s office, further enriching our understanding and implementation of labour-related programmes.”

Ensuring equality between participants

In essence, social dialogue needs to ensure equality between the participants. Emi Andriati, Field Consultant for CNV Internationaal states that there might be differences in the educational backgrounds that discourage some people from speaking up, which can be addressed through social dialogue. Specifically on women’s issues she believes that, “There should be a special space  for discussion for women. This can be started through the establishment of a gender committee, for instance.”

Women’s issues do not merely encompass women's labour, but also other overlooked women’s groups, such as the wives of the labourers or local housewives who experience harassment walking past the palm oil plantations. Another aspect is the environmental impacts from the plantation that spill over to the nearby settlements. “At the end of the day, the focus of the programme stays on the labourers but there are many factors  that contribute to the complexity of the situation,” Gultom adds.

Social dialogue: present and future

Andriati works on the day-to-day preparation of dialogues. The first meeting with Siak and Pelalawan Labour Service Regional Apparatus Organisation in April 2022 felt like a ‘guerrilla’ operation which continues  to this day. Her team continues to visit the plantation offices, industry and trade offices, investment and one-stop service offices, women and children empowerment services, the information and communication offices, and the regional development agencies to initiate more opportunities for dialogue.

Local government and community participants support the dialogue process. However, Gultom notes  that the dialogues need more active participation from the private sector, where the practice is not part of the current culture. Andriati echoes this message, saying that she hopes for a social dialogue culture in all corporations since the dialogues do require specialist skills to be most effective.

Ningsih adds that there needs to be the opportunity to continue the social dialogue process in the region to ensure the good work is continued.

 “The presence of a social dialogue culture will contribute to achieving more sustainable palm oil within 5-10 years, especially on the No Exploitation point for key issues in labour,” Gultom closes.