Job Creation Law Implementation after Constitutional Court Order

Mr. Hendry Wijaya is giving detailed explanation about Job Creation Law that there are still many parties who are still resistant to the Job Creation Act, the postponement of the Job Creation Act was rejected by the Court. President Jokowi has ensured business actors and investors from within and outside the country that the investments that have been made and investments that are being and will be in the process remain safe and secure. The Job Creation Law includes regulations related to Foreign Workers, Employment Relations, Working Time, Wages, Layoffs, and Provisions for Criminal Sanctions. The government also builds industrial relations facilities to facilitate business actors such as PP, PKB, SP/SB, Entrepreneur’s Organizations, Bipartite LKS, Tripartite LKS, PPHI Institutions, Per-UU.

Mr. Albertus Andhika explained that the Job Creation Law is still valid until the issuance of the revised version and Indonesian government is suspended to issue strategic decisions and has broad impact (including to issue the implementing regulations of the existing job creation). The Indonesian Government shall revise the existing Job Creation Law within 2 (two) years as of the date of the constitutional court decision being declared (25 November 2023). He also mentioned about potential issues that may arise such as: (1) If the Government fails to implement the constitutional court order, the unconstitutional status of Job Creation Law will become permanent, and all the pre-existing laws were revised or replaced by Job Creation Law (including its Implementing regulations) will become in-force once more, (2) Subject to further newly issued regulations (i.e., revised job creation law); arguably; all contracts or legal actions that were made based on the existing job creation law is at risk to be contested /or challenged as it against the revised job creation law. (FYI – Constitutional Court Decision does not apply retroactively.) (3) For projects that is on-going (negotiation process) prior or near to 25 November 2023 is at risk to be re-negotiate or amended to conform with the revised Job Creation Law. He also proposed some ways to mitigate the issues for company, such as: Adding change of law clauses in the agreement; to renegotiate or amend the agreement at post-revised job creation law and for company regulation and/or collective labor agreement: to ensure that all drafts being firstly consulted with the relevant Manpower office; and validated by Manpower Office. all records related to the discussion on the revision to company regulation and/or collective labor agreement shall be well-maintained.