Key points of labor reform in omnibus bill on job creation: What we know so far

first_imgThe government submitted the controversial omnibus bill on job creation to the House of Representatives on Wednesday, marking a milestone that will kick start deliberations on labor reforms that are intended to woo investors, boost economic growth and create jobs.  Some of the key highlights of the bill, a draft of which has been obtained by The Jakarta Post, cover issues related to foreign workers, wages, work hours, redundancy and social security. A one-off extra payment as a “token of appreciation” for workers, which the government calls a “sweetener”, is also introduced in the bill.“This is purely to create jobs amid the global uncertainty and the coronavirus crisis by transforming the country’s economy through the omnibus bill,” Coordinating Economic Minister Airlangga Hartato told the press at the House after submitting the bill. “As for now, we will raise the public’s awareness regarding the bill by involving government officials and lawmakers.” The office of the coordinating minister has formed a consultative team consisting of government officials, businesspeople and labor representatives. Still, the government has not yet published the bill for general scrutiny.Major labor groups including the Confederation of Indonesian Trade Unions (KSPI), the Congress of Indonesia Unions Alliance (KASBI) and the All-Indonesia Workers Union Confederation (KSPSI) have refused to join the coordination team. They have also rejected the bill because of its potential detrimental effect on labor rights.Here are some key points and changes related to labor reform in the omnibus bill on job creation compiled by the Post.Severance pay The calculation for basic severance pay remains unchanged, but overall rights for severance payments beyond basic allowances are either reduced or scrapped completely.The omnibus bill on job creation no longer mandates employers to pay for compensation of rights (UPH) for laid-off workers and instead stipulates that the rights can be regulated in a work contract, work agreement or corporate rules. According to Article 156 of the prevailing manpower law, UPH includes unredeemed annual paid leave, transportation costs and a certain sum from workers’ expenses for housing and medicines. The bill also cuts the upper limit for payments for recognition of service period (UPMK) to a maximum of eight months’ salary for a worker’s services of more than 21 years in a company. Article 156 in the manpower law caps the awards value higher at 10 months’ salary for more than 24 years of service.Meanwhile, rigid calculations on rights for severance payments, UPMK and compensation of rights (UPH) that are differentiated based on reasons for the lay-off, as stipulated in the prevailing manpower law, are all scrapped. Instead, the omnibus bill on job creation only requires employers to make severance payment and UPMK according to their time of service.Foreign workersIndonesia will open more chances for expatriates to work in the country, especially in start-ups.In the omnibus bill, foreign workers will also be allowed to work in Indonesia without a permit in positions that range from members of boards of directors and commissioners, and diplomatic or consular staff, to researchers and emergency engineers. Foreign workers in start-ups will also be exempted from work-permit requirements.This compares with a previous stipulation in Article 42 of Law No. 13/2003 on Manpower that only exempts diplomatic and consular staff from work permits for foreign workers.OutsourcingOutsourcing requirements would be significantly relaxed under the omnibus bill on job creation.Currently under Article 66 of the Manpower Law, workers from outsourcing agencies are prohibited from doing core tasks or those that directly relate to the production process. The prevailing rule stipulates workers from outsourcing companies can only have supporting functions.The omnibus bill on job creation amends this stipulation to open the possibility for outsourcing agencies to hire workers for various tasks, including freelance and full-time workers. This stipulation will be further regulated in a separate Government Regulation (PP).RemunerationGovernors across Indonesia will determine the minimum wage of each region, based on the inflation rate and economic growth in the region, to better reflect the need for salary adjustment. A so-called council for wages can provide input during the process, which would comprise government, business, labor and academic representatives. This stipulation is basically unchanged from the existing regulation.However, the significant difference under the omnibus bill on job creation is that labor-intensive industries will not have to adhere to regional minimum wages and the governors of respective provinces will use different formulas in their calculations. More details will be covered in a separate PP, according to the draft bill.Micro and small businesses are exempted from minimum-wage stipulations but must pay their workers above the poverty line rate, the draft states.Labor rightsMembers of the Confederation of Indonesian Trade Unions (KSPI) protest against the omnibus bill on job creation in front of the Parliament Building, Senayan, Central Jakarta, on Wednesday. (JP/Dhoni Setiawan)A prevailing article that stipulates workers’ rights for paid leave under certain circumstances has been deleted from the omnibus bill on job creation.Article 93 of the Manpower Law allows paid leave of three days when workers get married, two days when their children are circumcised or baptized or get married, or when their wives are in labor or undergoing an abortion. Workers whose family members pass away get one to two days’ unpaid leave in the current regulation.The omnibus bill, however, deletes this stipulation and will only cover regular paid leave rights that include at least 12 days a year for workers that have been with their companies for 12 consecutive months. “Companies can grant long leave, which is arranged in the work contracts, company regulations or work agreements,” the draft bill reads.Further, in a case where a company goes into bankruptcy or is liquidated, labor rights are to be prioritized prior to other payments including to creditors – a stipulation previously uncovered by the existing law.Work hoursEmployers can implement work hours beyond stipulation for specific types of work or business sectors. These special conditions will be further regulated in a separate PP, which were not previously covered by the existing Manpower Law.Work hours as stipulated by the omnibus bill on job creation are eight hours per day and 40 hours per week—five days in a week. Beyond that employers must pay overtime to workers but not exceeding four hours a day and 18 hours a week, according to the draft omnibus bill.LayoffThe omnibus bill on job creation aims to provide a better safety net for workers with a minimum of one year’s service as a separate PP will stipulate compensation payments, according to Article 61A.Employees can be laid off for reasons that include mergers, acquisitions, divestment, business efficiency, business closure after two years’ uninterrupted financial losses or as a result of force majeure, debt restructuring and bankruptcy, among other factors, based on Article 154A.Workers are still entitled to receive their salary and other rights –also including their work responsibilities— during dispute-settlement processes at industrial relations agencies or in court, according to Article 157A. These three stipulations were previously not covered by the current law.Meanwhile, the omnibus bill revokes Article 159, which allows workers to file a lawsuit to an industrial relations court or agency if they want to challenge the reasoning behind the decision to lay them off.Social securityA new social safety net mechanism is added to the omnibus bill on job creation to revise Article 18 of Law No. 40/2004 on the National Social Security System (JSN) and Article 6 of Law No 24/2011 on the Social Security Organizing Agency (BPJS).The social security program for laid-off workers was introduced on top of existing programs that currently cover health, work-related accidents, pensions, old age and life insurance. The BPJS will be responsible for the fund so long as the workers or their employers pay the premiums.“Sweetener” bonusThe government has long campaigned about a “sweetener” in the omnibus bill on job creation that will include an immediate salary bonus depending on workers’ length of service in their companies.According to the draft bill, workers will get the “sweetener” or bonus as follows: one year’s salary for service of less than three years, twice the salary for three to six years of service, three times the salary for six to nine years of service, four times the salary for nine to 12 years of service. Finally, five times the salary for workers with over 12 years of service.The bonus will only be applicable to medium and large companies as micro and small enterprises are exempt from the stipulation. The bonus is a one-off payment to be made within one year after the omnibus law on job creation becomes effective and details will be further regulated in a PP.Editor’s note: The article has been updated to include a section on severance pay.Topics :last_img read more

Environmental activism? There are apps for that

first_imgFor Indonesia, forest conservation and efforts to mitigate and prevent land and forest fires has been a big focus area in the digital space. The severity of annual blazes, which managed to raze 1.65 million hectares of land last year, has pushed environmental groups and government agencies to develop digital tools to help mitigate the disaster.Here are a few examples of apps that look to bridge the digital divide in conservation efforts:Urundata is a crowdsourcing app that invites its users to help interpret landscape and environmental data for research and environmental restoration purposes.The app, launched in April last year, boasts over 1,000 downloads on Google Play Store, with 1,055 data contributors in 19 campaigns helping to observe 4,408,458 landscape spots. Conservation and environmental activism are no longer limited to professionals working and interpreting data in the field, as regular civilians can now pitch in through mobile apps that not only educate, but also invite people to contribute to conservation efforts from the screens of their smartphones.As the global community commemorates World Telecommunication and Information Society Day on Sunday, United Nations Secretary-General António Guterres reminds people that new technologies are “powerful tools to tackle the world’s most pressing challenges”.“International cooperation on digital technology is essential to […] achieve the 2030 Agenda for Sustainable Development,” Guterres said in his 2020 commemoration message. The app is a project of the RESTORE+ consortium, which consists of the World Agroforestry Center (ICRAF), World Resources Institute (WRI) Indonesia, World Wildlife Fund (WWF) Indonesia, International Institute for Applied System Analysis (IIASS), as well as 10 higher learning institutions in South Sumatra.IIASS scholar Ping Yowargana, one of the developers of the app, said the group looked at crowdsourcing efforts such as Kitabisa or change.org and wished to implement similar methods for data gathering on landscape information to help restoration efforts and guide policymaking.“We wanted to try quality crowdsourcing that still fulfills some scientific criteria, resulting in efficient and cheap data gathering gleaned from people’s contribution” Ping told The Jakarta Post this week.The app gamifies data gathering and interpretation, in which users are presented with satellite images of various landscapes and then asked to identify what kind of landscape it is – informing users of the differences between primary forests and man-made plantations.The app has so far gathered data from South Sumatra and East Kalimantan, provinces that have a wide range of geographical make-up and are prone to annual forest and land fires.It is currently gathering national data for restoration landscapes, asking users to distinguish between primary forests, secondary forests, plantations, agricultural land, grass fields and savannas.Ping said the data would be made publicly available on the urundata.id website once all the data had been collected.The Peatland Restoration Agency (BRG) has also developed its own smartphone app dubbed Mitra Gambut (Peat Partners), together with the Partnership for Governance Reform (Kemitraan) nongovernmental organization.The app will serve as an online platform for villagers in peatland areas to share best practices on peatland restoration.The app, launched in 2018, has been installed on more than 1,000 devices, mostly by villagers and the project facilitators. It works like a social network platform, but puts an emphasis on geospatial features such as geotagging (marking the location of posts).The BRG’s deputy for promotional education and partnerships, Myrna Safitri, said Mitra Gambut was meant as a companion app for the agency’s Villages Care for Peatland program, so villagers and their facilitators have a platform to share their restoration practices and success stories.“The app is for them a place of education. They share what can be successfully planted in their villages, and in turn others are motivated to communicate [through the app],” she said.The Riau Police have developed a smartphone app called Lancung Kuning Nusantara to assist police and military personnel across 11 provinces in Sumatra and Kalimantan to aid prevention and law enforcement against land and forest fires.With the app, security personnel and civilians can volunteer by reporting land and forest fires when they occur. Once they register for an account in the app, users are also able to look for hot spots that have emerged within the past 24 hours – using various satellite data and imaging to inform.For more simplified data on forest fires within the last 24 hours, the LAPAN: Fire Hotspot app is a solid alternative.Both apps have been installed on more than 50,000 devices.The Environment and Forestry Ministry has also jumped on the digital bandwagon by launching its land and forest fires monitoring system SiPongi, which is available through the sipongi.menlhk.go.id website and as a smartphone app. Found on Google Play Store, the app has been downloaded and installed on more than 1,000 devices.Topics :last_img read more