JISEAS Issue Paper No. 11 

Endang Rokhani and Je Seong Jeon

Impact of Job Creation Law on Workers' Rights in Indonesia: Interview with a Labor Lawyer and Activist

In Indonesia, the Job Creation (Omnibus) Law was enacted on November 2, 2020 with the aim of increasing jobs by creating a good environment for business. Many trade unions protested on the streets claiming that this law seriously retreated labor rights, and brought the law to the Constitutional Court. Through e-mail interviews, we heard opinions on the Job Creation Law from Endang Rokhani, a local labor lawyer and activist with 30 years of experience. First of all, as to how it will affect workers' rights, she analyzes that this law brings about seriously infringing changes in the wage and dismissal system. Specifically, she focused on the simplification of the regional minimum wage system, exemption from the obligation to pay the minimum wage for small and micro enterprises, liberalization on the duration of contract workers, allowing unilateral dismissal procedures, and reduction of severance pay. Second, she shares her perspective on the impact on the trade union movements. In the legislative process, the unions carried out resistance in various ways, but not only could not prevent the enactment of unfavorable law, but also divided into three categories, resulting in the possibility of continuing antagonism. In addition, the abolition of the procedure that took into account the recommendations of the Wage Committee, in which the unions participated in determining the regional minimum wage, was expected to weaken the influence of the unions. After the interview, there are additional questions that we will consider together. Despite the recession of the labor rights, there are already dark prospects that new investments to be promoted by this law will not create remarkable jobs. Furthermore, attention is paid to how the new politics, which not only the president and ministers, but also the parliament, are transforming business-friendly, will change the lives of the Indonesian people in the future.