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Manpower Minister says Perppu protects workers

Jakarta Post - January 9, 2023

Fadhil Haidar Sulaeman, Jakarta – Manpower Minister Ida Fauziyah and her officials have shrugged off claims that the government regulation in lieu of law (Perppu) on job creation disadvantages workers.

Ida said that the job creation Perppu is an "improvement" from the previous job creation law, a regulation that was massively rejected by workers due to its perceived pro-business provisions.

The minister argued that the job creation regulation was a result of government consultations on job creation law in several major cities, such as Jakarta and Semarang, and had been thoroughly researched with "several independent institutions."

"The government conducted discussions regarding the substance that needed to be changed [from the job creation law]," Ida said in a statement, adding that "the main considerations are creating and increasing employment, protecting workers and also businesses."

Ida assures that in this Perppu, the government will backtrack on its decision to deregulate outsourcing, a key policy of the job creation law, and promised to limit the type of jobs that are available to be filled by outsourcing firms.

Furthermore, she said minimum wages at regency and city levels were able to be determined by governors if the minimum wages on these lower-level administrations were higher than provincial ones.

These policy plans, she said, would be written in a derivative government regulation (PP).

"This Perppu is the government's most sincere attempt to provide adaptive protection to workers in facing more dynamic manpower challenges," the minister said.

In a virtual press conference held on Jan. 6, the ministry's industry relations and manpower social insurance director general, Indah Anggoro Putri, has asserted that by introducing this regulation, the government "has repealed" the job creation law.

Nonetheless, she pointed out that the provisions within the job creation law that are not contradictory to the job creation regulation will remain effective. As a result, she said the regulations that were previously under the job creation law and had contradicted the Perppu would be revised to suit the job creation regulation, including PP No. 36/2021 on the minimum wage formula.

The minimum wage regulation has been part of a recent dispute between employers and labor unions since it does not consider the impact of inflation. It also contradicted the job creation law that mandates inflation to be factored in minimum wage calculation. The ministry later issued the Manpower Minister Regulation No. 18/2022 that accommodates the formula mandated by the job creation law.

"The job creation law is not effective per the signing of the Perppu last December," Indah told reporters.

Source: https://www.thejakartapost.com/business/2023/01/09/manpower-minister-says-perppu-protects-laborers.htm