Freeport Strike Over


On Wednesday union heads clinched a deal with Freeport management to end the three-month long strike at West Papua’s troubled Grasberg mine.

"At 5.30pm [Jakarta time] an agreement was reached," said an SMS sent by a union official to New Matilda. "Hopefully this decision is the best for all of us, from the workers’ welfare point of view".

Nine people have been killed since the strike started on 15 September, with a number of workers shot by police during protests. The striking workers have been living on their savings because Freeport stopped paying their wages and the union, which relies on members’ contributions, has also suffered.

"Many of our members have taken bank loans as there was no wage coming in. These banks demand payment soon," said Pyhtal Tri Poes, one of the union officials, in an interview with New Matilda.

In the deal that was brokered on Wednesday, the workers will get a 37 per cent wage increase that will be paid over two years: they will receive a 24 per cent increase on their wages backdated to 1 October 2011, and from 1 October 2012 they will receive a further 13 per cent increase. This is far from what the union originally demanded, which was a 200 per cent wage increase from US$2.50 to US$7.50 per hour.

In addition, the striking miners will be paid their lost salaries from the three-month strike. Disciplinary action against a number of strikers has been withdrawn and complete amnesty given. The deal also suggests that all allowances — health care, housing, education, shift premiums, service-year bonuses, and a metal bonus — will be calculated on fixed costs rather than Freeport-McMoRan’s demand of variable cost schemes.

However the deal is not ideal for the union. "We are not entirely happy with the wage deal," said Juli Parorrongan, one of the union bargaining committee members. "We made the decision to settle due to humanitarian reasons and out of concern for our workers. They have no money, very little to eat, and having no pay checks have pushed them to the brink of poverty".

The final negotiation came suddenly. For over two months, the union has resisted pressure not only from management but also from the Indonesian security forces. The Indonesian government has also intervened.

Last week the government called a meeting with the union in attempt to end the strike. In an SMS sent to New Matilda at the time, union secretary Albar Sabang said, "We are in a meeting with the Indonesian government that we never expected before".

New Matilda understands that in the meeting the government representative briefed the union about the latest security situation in West Papua and said the union’s actions could further destabilise the province. Last week there were a number of shootings around the Paniai district and Freeport area.

Last month Freeport McMoran CEO Richard Adkerson met Indonesian President Susilo Bambang Yudhoyono in Honolulu as he was on his way to Cannes to attend the G20 Summit. In the meeting Adkerson asked Yudhoyono to "find the best solution" to the strike action. He also told the President about Freeport’s plan to spend US$10-$20 million expanding its business in West Papua.

This week’s deal with Freeport management could be "the best solution" that Adkerson requested.

Either way, the union has cautiously welcomed the deal. The 15 members of the bargaining team will go back to Timika this week and celebrate the outcome with its members. However, as union official Juli Parrorangan, says "it’s not the end, only the beginning. The energy and unity of our struggle now enters the workplace".

Launched in 2004, New Matilda is one of Australia's oldest online independent publications. It's focus is on investigative journalism and analysis, with occasional smart arsery thrown in for reasons of sanity. New Matilda is owned and edited by Walkley Award and Human Rights Award winning journalist Chris Graham.