Revitalizing Labour Rights: ILO’s SIRI Project Supports Indonesian Trade Unions

To ensure practical utility, the platform includes instructional videos on workplace dispute resolution, sexual harassment prevention, and employment practices.

Indonesia’s dynamic labour landscape is undergoing rapid transformation, driven by significant regulatory reforms and the evolving nature of work. At the center of these changes stands the Job Creation Law (commonly referred to as the Omnibus Law), which introduced sweeping modifications across a range of employment-related regulations. While the law aims to stimulate investment and boost economic growth, it also presents profound implications for worker rights, trade union relevance, and labour market stability—particularly in labour-intensive sectors such as garment manufacturing.

Recognizing these challenges, the International Labour Organization (ILO), through its Strengthening Industrial Relations in Indonesia (SIRI) project, has taken a strategic and proactive role in supporting Indonesian trade unions. The project’s core mission is to empower trade unions to adapt, engage in meaningful policy dialogues, and advocate for improved working conditions amidst the shifting regulatory environment.

Two key initiatives under the SIRI project—(1) the development of a comprehensive Labour Law Guideline website, and (2) a focused impact study on fixed-term employment contracts in the garment sector—exemplify the ILO’s commitment to promoting decent work and equitable industrial relations in Indonesia.

The Labour Law Guideline: A Digital Hub for Employment Knowledge

One of the cornerstone achievements of the ILO’s SIRI project is the creation of the Labour Law Guideline website, a vital digital resource developed in collaboration with Better Work Indonesia (BWI), a joint initiative of the ILO and the International Finance Corporation (IFC). This platform is designed to equip workers, trade unions, employers, and government officials with accessible, accurate, and up-to-date legal information.

The website functions as a centralized repository of Indonesian labour regulations, encompassing:

• The National Constitution

• Labour-related laws and acts

• Government and presidential regulations

• Ministerial and directorate general decrees

• Provincial, governor, and district-level regulations

It covers nine critical labour topics, including:

1. Child Labour

2. Discrimination

3. Forced Labour

4. Freedom of Association and Collective Bargaining

5. Compensation

6. Work Agreements and Human Resources

7. Occupational Safety and Health (OSH)

8. Working Hours

9. Industrial Relations and Dispute Resolution

To ensure practical utility, the platform includes instructional videos on workplace dispute resolution, sexual harassment prevention, and employment practices. Additionally, it offers an interactive simulator that enables users to easily calculate:

• Overtime pay

• Severance pay

• Religious Holiday Allowance (THR)

This user-friendly tool allows both employers and workers to conduct accurate and compliant payment calculations independently. To date, the website has attracted over 31,000 visitors, highlighting its growing relevance and utility across labour stakeholders in Indonesia.

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Impact Study on Fixed-Term Employment in the Garment Sector

In response to the enactment of the Job Creation Law, the ILO’s SIRI project conducted a comprehensive study examining the law’s Employment Cluster Regulation, with a focus on fixed-term employment contracts (PKWT) within the garment industry—a sector that employs millions and is heavily dependent on contract-based labour.

Led by Nurus Mufidah, Project Coordinator of SIRI, the study analyzes the implications of the law’s revised contract employment provisions, especially those affecting worker security, income stability, and collective bargaining rights. While the reforms are designed to increase labour market flexibility and investor confidence, they have raised concerns among trade unions and labour rights advocates over potential erosion of job security and social protections.

The study adopts a multi-dimensional approach by combining:

• Legal analysis of regulatory changes

• Examination of recent court rulings

• Interviews and focus groups with employers, workers, and union representatives

• Real-world case studies in the garment sector

Key Recommendations from the Study:

1. Balance Flexibility with Protection: While adaptable labour laws are important for business competitiveness, they must not come at the expense of workers’ rights or job security.

2. Strengthen Communication and Outreach: Employers and workers need to be well-informed about regulatory changes to ensure proper implementation and compliance.

3. Enhance Enforcement Mechanisms: Strong regulatory oversight is critical for upholding labour standards and resolving violations effectively.

4. Protect Non-Regular Workers: It is vital to guarantee benefits and security for fixed-term and informal workers to promote social equity.

5. Ensure Social Security Sustainability: Long-term viability of worker support systems must be safeguarded to prevent vulnerability during economic shocks.

6. Foster Multi-Stakeholder Collaboration: Constructive engagement among government, employers, and unions can result in balanced and practical policies.

7. Adapt Regulations to Sectoral Needs: Industry-specific policy frameworks ensure that the unique challenges and structures of each sector are adequately addressed.

Through this study, the ILO’s SIRI initiative aims to inform evidence-based policymaking and promote alignment with international labour standards, advancing Indonesia’s goal of achieving fair and sustainable employment outcomes.

Charting a Resilient Future for Indonesian Workers

The ILO’s SIRI project has emerged as a critical ally for Indonesia’s labour movement, helping trade unions not only survive—but evolve and lead—in the face of daunting regulatory changes and future-of-work challenges. By fostering legal literacy, promoting transparency, and enabling stakeholder dialogue, the project has created avenues for more inclusive and informed labour policy development.

Moving forward, continued support and engagement among all stakeholders—unions, employers, government bodies, and international organizations—will be essential in building a labour market that is fair, competitive, and resilient in the years to come.

For more information, explore the Labour Law Guideline website or follow updates from ILO’s Strengthening Industrial Relations in Indonesia (SIRI) project.