Coordinating Minister for Economic Affairs, Airlangga Hartarto, announced that the government plans to revise regulations concerning Fixed-Term Employment Agreements (PKWT) and outsourcing within the new Manpower Law.
This adjustment is part of Indonesia’s broader effort to harmonize its labor regulations with international trade agreements. It also responds to feedback from the United States and follows up on the Constitutional Court’s decision regarding the employment cluster in the Job Creation Law.
The policy is expected to strengthen legal certainty and clarify the boundaries for using contract and outsourced workers. One of the key proposals includes limiting the duration of PKWT to prevent workers from remaining in prolonged uncertainty about their employment status.
The government also highlighted that the revision aims to strike a balance between protecting workers’ rights and maintaining an investment-friendly business environment.
