Indonesia passes new Labor Protection Law

Indonesia’s House of Representatives has passed the Labor Protection Law, a significant legislative overhaul designed to address previous legal uncertainties and comply with a Constitutional Court ruling. The new law consolidates various labor regulations to provide more equitable protections for the workforce.

Key provisions include strict anti-discrimination measures in recruitment and wages, and a prohibition on employers withholding workers' diplomas or personal documents. The legislation also introduces enhanced protections for jobseekers and formalizes rights for apprentices, who are now limited to a maximum six-month term and are entitled to stipends and occupational safety coverage.

For outsourcing workers, the law limits total contract duration to four years, with initial contracts lasting up to two years followed by a maximum of two one-year extensions. Outsourcing is specifically restricted to four sectors: catering, security, cleaning, and driving. Additionally, the law extends social protections to informal and digital platform workers, ensuring greater legal certainty for the gig economy.