Manpower Minister: Regulation in Lieu of Job Creation Law Aims to Provide Protection to Workers

By Office of Assistant to Deputy Cabinet Secretary for State Documents & Translation     Date 6 Januari 2023
Category: News
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Minister of Manpower Ida Fauziyah, Minister of Industry Agus Gumiwang Kartasasmita, Minister of Maritime Affairs and Fisheries Sakti Wahyu Trenggono, and Minister of Foreign Affairs Retno Marsudi engage in a dialogue before the Plenary Cabinet Meeting, Tuesday (04/05), at the State Palace, Jakarta. (Photo by: PR of Cabinet Secretariat/Agung)

The Government has renewed commitment to providing workers protection and business continuity amidst challenges of labor dynamics through Government Regulation in Lieu of Law (Perppu) Number 2 of 2022 on Job Creation.

According to Minister of Manpower Ida Fauziyah, substances on employment regulated in the Regulation are revisions of Law Number 11 of 2020 on Job Creation.

“The revision of substances on employment contained in the Regulation stands as the Government’s initiative in providing adaptive protection to workers/labors in facing the challenges of labor dynamics,” Ida said in a written statement uploaded on the Ministry’s official website, Friday (01/06).

The revised substances include:

First, outsourcing policy. The Regulation restricts types of outsourced jobs, while the Job Creation Law does not stipulate restrictions on types of work that can be outsourced.

“With the new regulation, not all types of work can be easily outsourced because it will be regulated in a government regulation,” Ida said.

Second, revision and adjustment of minimum wage calculation. The calculation of minimum wage takes into account economic growth, inflation, and certain indexes. The formula to calculate minimum wage including certain indexes will be further regulated in a Government Regulation (PP).

The Government Regulation in Lieu of Law also stated that governors are obliged to set the provincial minimum wage (UMP) and can set the minimum wage for the regency minimum wage (UMK) if the calculation of UMK shows that it is higher than UMP.

“The word ‘can’ referred to in the Regulation means that the governor has the authority to set the UMK if the calculated value is higher than the UMP,” she said.

Third, the obligation of employers to implement a wage structure and scale for workers and labors who have worked for one year or more.

Fourth, regarding the use of disability terminology in accordance to Law Number 8 of 2016 on Persons with Disabilities.

Fifth, revision of references in the article that regulates wages payable [to a worker] using the right to rest and the benefits of the Job Loss Guarantee Program.

On that occasion, the Minister of Manpower explained that the changes related to the employment substances are based on the results of absorption of aspirations towards Job Creation Law carried out by the Government in several regions, including Manado, Medan, Batam, Makassar, Yogyakarta, Semarang, Balikpapan, and Jakarta.

In addition, several independent institutions have also conducted studies regarding workforce-related matters.

“Based on these matters, the Government then discussed the substances that needed to be revised. The main considerations include creating and increasing employment, protecting workers/labors, as well as business continuity,” the Minister remarked. (UN) (RIF/MMB)

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