Spotlight on Indonesia: Scaling up worker protection through multi-company collective bargaining agreements

In this Local Spotlight series, we highlight the work of STITCH and its local partners in the countries where garments are made — from building trust on the factory floor to improving human rights due diligence (HRDD) from the ground up. This time, we turn to Indonesia, where an innovative approach to collective bargaining is improving working conditions across the sector. 

A collective approach to better conditions 

In Indonesia, STITCH partners support a multi-company collective bargaining agreement (MC-CBA) program that involves multiple companies in the same region. In this process, management representatives from various factories and their respective unions come together to receive extensive training in bipartite social dialogue and the technical aspects of the CBA process. This program equips them to negotiate their CBAs effectively at the company level. 

CNV Internationaal developed this approach and has significantly expanded it under STITCH, with implementation led by Yayasan Dialog Sosial, an organisation set up by CNV Internationaal that comprises representatives from unions, employers, and the government. 

Why it matters 

The number of garment factories in Indonesia with CBAs is alarmingly low. Many of those that do exist are often rehashed versions of existing company regulations, without actual negotiation with the workers on the ground. Consequently, critical issues such as low wages, unpaid overtime, and the right to freedom of association frequently remain unaddressed.  

With STITCH’s support, unions and management within garment factories built social dialogue skills, creating space for genuine negotiation. As a result, the CBAs achieved are not only more favourable than the law but also address the actual needs of workers. 

Real results 

So far, MC-CBAs have improved working conditions for at least 35,350 workers across 32 factories in Indonesia. Due to the intensive social dialogue process resulting in CBA negotiations with multiple factories, unions are often able to negotiate CBAs with provisions beyond legal minimums, leading to higher wages, better protection of workers and a decrease in human rights risks. 

“MC-CBAs are effective agreements because they are conducted through genuine social dialogue that brings many benefits to all partners involved,” says Iyan Sopyan of Yayasan Dialog Sosial. 

What’s next 

To expand the impact, we are calling on more brands to support these agreements — their involvement is key to securing strong commitments and making progress sustainable. Brands can back their suppliers involved in the MC-CBA projects and help strengthen the outcomes of the newly negotiated CBAs through improved purchasing practices or increased prices, resulting in more ambitious CBAs. At the same time, this approach directly supports STITCH’s broader goal: advancing HRDD in supply chains by embedding inclusive, rights-based practices.