“Call to End Alleged Forced Labour Practices and Labour Rights Violations at PT Huadi Nickel Alloy Indonesia, Bantaeng, South Sulawesi”

To:

His Excellency Mr Wang Lutong

Ambassador of the People’s Republic of China to the Republic of Indonesia

Mr Li Hongwei

Economic and Commercial Counsellor

Chinese Embassy in the Republic of Indonesia

Jl. Mega Kuningan No.2, South Jakarta 12950, Indonesia

We, the Legal Aid Institute (LBH) Makassar, acting as legal counsel for the workers of PT Huadi Nickel Alloy Indonesia (PT HNAI), particularly those in Unit T1 Yatai and Unit T2 Wuzhou at the Bantaeng Industrial Zone, respectfully submit this open letter to report workplace human rights violations committed by PT HNAI. These include alleged practices of forced labour, non-payment of overtime wages in accordance with regulations, and the payment of wages below the Provincial Minimum Wage (UMP) of South Sulawesi.

Since commencing operations in the Bantaeng Industrial Zone (KIBA) in 2018, PT Huadi Nickel Alloy Indonesia—a subsidiary of the China-based Huadi Steel Group—has established itself as a major player in South Sulawesi’s nickel processing industry. Yet instead of upholding Indonesian labour laws, the company has created working conditions that perpetuated exploitative practices and directly violated workers’ fundamental rights.

In line with this letter, LBH Makassar, together with the workers, have also reported the alleged human rights violations and forced labour practices at PT Huadi to the National Commission on Human Rights (Komnas HAM) in Jakarta. This step underlines that the issue at PT Huadi is not merely an ordinary industrial dispute, but rather a recurring pattern of exploitation that undermines workers’ dignity and violates both labour law principles and international human rights standards. We therefore consider it essential to convey this matter directly to the Government of China through its Embassy in Jakarta, so that it receives serious attention and prompts Chinese-owned companies to comply with Indonesia’s national laws as well as international labour standards.

The following labour rights violations were reported and documented by our client workers in relation to PT Huadi:

1. Alleged Forced Labour Practices and Unpaid Overtime

• Workers are forced to work 12-hour shifts daily (07:30–20:00), including 80 hours of compulsory overtime, which amounts to 240 hours per month, exceeding the legal limit. They are not provided with adequate rest periods.

• These working hours and compulsory overtime are imposed unilaterally, and workers who refuse face threats of warning letters or other sanctions.
• Excessive working hours, forced overtime, wages below the provincial minimum wage, and intimidation constitute forced labour, as prohibited under ILO Convention No. 29 (1930), ILO Convention No. 105 (1957), Law No. 19/1999 ratifying ILO Convention No. 105, Law No. 13/2003 as amended by Law No. 6/2023 on Manpower, and Law No. 39/1999 on Human Rights.
• Overtime pay is not provided in accordance with regulations, despite official calculations by the Labour Inspectorate showing underpayment since November 2021. A decision by the Labour Inspectorate dated 27 May 2025 confirmed the underpayment to 20 workers.

2. Violation of Minimum Wage Regulations

• The company pays a basic wage of only IDR 3,500,000, below the 2025 South Sulawesi provincial minimum wage of IDR 3,657,527.37.
• This shortfall affects hundreds of workers and constitutes a violation of Indonesia’s criminal labour law. Such violations occur when an employer breaches mandatory provisions under Indonesia’s Labour Law (Law No. 13/2003 as amended by Law No. 6/2023), including failure to pay legally mandated wages and imposing excessive work conditions without proper compensation.

3. Abuse of the legal system and denial of religious rights

• The company has deliberately ignored orders from the Labour Inspectorate. Instead of fulfilling workers’ entitlements, the company initiated legal proceedings at the Industrial Relations Court in Makassar to legitimize practices that contravene the law (Case No. 30/PDT.SUS-PHI/2025/PN.MKS). In response, the workers filed a counterclaim to ensure their rights are upheld and to seek justice for all employees subjected to similar violations.
• During the hearings, the company admitted that its work system requires employees to exceed the legal limit of 8 hours per day or 12 hours per shift. At times, workers were made to work 12 hours a day for 31 consecutive days, 372 hours in a month, more than double the legal maximum of 173 hours.
• This practice constitutes an abuse of the legal system and denies workers the right to observe their religious obligations. In Bantaeng Regency, where most of the workforce is Muslim, operations continue during Friday Prayers. Workers must remain at their posts to monitor machines, preventing them from performing this obligatory act of worship. This constitutes a grave violation of the right to religious freedom.
• In addition, in the furnace department (where ore is smelted), supervisors sometimes order workers to enter furnaces for cleaning while they remain hot, causing shoes to melt and putting worker’s safety at risk.
• The company’s submissions to the court, and the evidence revealed during the hearings, appear to be attempts to justify a work system that clearly violates Indonesian law and fundamental human rights.

Given that PT Huadi Nickel Alloy Indonesia is a company supported by Chinese capital and business networks, we respectfully request the Government of China to:

• Immediately halt any form of support for the forced labour practices carried out by PT Huadi Nickel Alloy Indonesia.
• Urge the management of PT Huadi Nickel Alloy Indonesia to promptly pay outstanding overtime wages and adjust salaries in accordance with the provincial minimum wage.
• Ensure that Chinese companies operating in Indonesia comply with Indonesian national law, Chinese guidelines and principles on responsible overseas investment, ILO standards, and international human rights principles.
• Urge Chinese companies to open a dialogue with workers and their legal representatives, rather than resorting to criminalisation.

We hope this message will be forwarded to the relevant government departments in China for prompt action. We also request a written response at your earliest convenience and no later than 20 October 2025

Yours faithfully,

Legal Representatives