Indonesia’s New Law May Negatively Impact Workers’ Rights



In June, several regional Indian governments Proposed temporarily suspending certain basic labour rights with the aim of revitalising the economy and attracting foreign investments in a post COVID-19 context. amfori took a clear stance on this worrying proposal.

Unfortunately, another country, Indonesia, seems to now be considering something similar. On 15 September, the Coordinating Minister for Economic Affairs of Indonesia stressed that the Omnibus Bill on Job Creation is nearing completion. If approved, the Bill would possibly weaken protection of existing workers’ rights for an indefinite amount of time. The pending labour reforms would have several consequences for workers, including:

  1. Increased precariousness of work agreements
  2. Increased overtime work for specific sectors, where the amount paid for extra hours would be established by individual employers
  3. Lower wages, due to the change in the formula used to calculate minimum wage and greater freedom granted to employers
  4. Elimination of certain forms of paid leave, such as leave for marriage or death of family members, parental leave and religious holidays, which currently sum up to 12 days of paid annual leave currently provided to workers


amfori’s Actions

For amfori members, amfori BSCI requirements will continue to be applied even if the government requirements are relaxed, thus maintaining respect to the ILO Conventions and Recommendations on which the amfori BSCI Code of Conduct was built. We invite our members who source from Indonesia to follow local developments carefully.

If you want to know more, please get in touch with, Social & Environmental Policy Advisor.

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