Indonesia's parliament has passed a new labor bill to strengthen worker protections, reversing several pro-business provisions previously established under the 2020 Job Creation Law. Drafted following a 2024 Constitutional Court ruling, the legislation increases severance pay allowances, tightens restrictions on employee dismissals based on cost efficiency, and introduces a severance security program requiring employer contributions to the state insurer BPJS. Manpower Minister Yassierli stated that the law balances fundamental worker rights with business sustainability, while also expanding social security, fair pay, and algorithmic transparency protections to platform and informal workers.The policy shift comes as President Prabowo Subianto's coalition addresses economic pressures, public discontent, and financial market volatility stemming from capital outflows and surging fuel subsidies. However, the Indonesian Employers Association warned that the higher labor costs mandated by the law could discourage formal hiring and diminish the nation's overall competitiveness. Legal experts are currently advising businesses to review wage structures and planned terminations, as the law also reinstates sector-specific minimum wages and imposes strict limits on corporate workforce reductions.Source: https://www.reuters.com/world/asia-pacific/indonesian-parliament-agrees-higher-severance-benefits-new-labour-law-2026-10-06/?utm_source=chatgpt.com (ICE GIACARTA)

Fonte notizia: Reuter, 6 October 2026