Study On The Indonesian Labor Laws

The domestic research on labor legal system of ASEAN countries mostly starts from labor legal risks and provides investment risk avoidance suggestions for "going out" enterprises in "One Belt,One Road",but less in-depth special research on labor legal system of Indonesia.The fall of the Suharto regime triggered simultaneous political,economic and social changes in Indonesia,and the democratized Indonesia has improved its business environment as a major means of attracting foreign investment,and labor law reform is one of the key requirements.Based on Indonesia’s Law No.13/2003 concerning Manpower,this paper examines Indonesia’s labor legal system in depth,and combines the comparative analysis of new laws such as the Law No.2/2004 concerning Industrial Relations Disputes Settlement and Law of the Republic of Indonesia No.11/2020 on Job Creation and relevant practical cases to sort out the current situation and shortcomings of Indonesia’s labor legal system,and finally comes down to the labor relations risks faced by Chinese enterprises investing in Indonesia and their prevention,with a view to benefiting their investments.The body of this paper is divided into four parts: The first part is an overview of the historical evolution of Indonesia’s labor legal system,analyzing the background and evolution of Indonesia’s labor legal system in the context of the current state of labor productivity in Indonesia,which not only presents the dynamic changes of Indonesia’s labor legal system,but also indirectly proves the necessity of this study;The second part analyzes the specific content of Indonesia’s labor legal system in terms of the subjects and scope of application,types and transformation of labor contracts,and circumstances and costs of dismissal and so on,taking into account the specific provisions of Law No.13/2003 concerning Manpower,Law No.2/2004 concerning Industrial Relations Disputes Settlement and Law of the Republic of Indonesia No.11/2020 on Job Creation with relevant practical cases to show what Indonesia Labor Law is;The third part is based on Indonesia’s labor legal system to identify its shortcomings: frequent legislation leading to an unstable legal environment,overly labor-oriented institutional design,and overly harsh foreign labor policies;The fourth part is about the labor relations risks faced by Chinese companies investing in Indonesia and its prevention suggestions.The Labor relations risks include the rising trend of labor costs in Indonesia,the seriousness of Chinese labor problems in Indonesia and the overpowering of Indonesian labor unions.The corresponding recommendations for prevention include paying attention to the differences in labor laws between China and Indonesia,knowing and complying with Indonesian labor laws and promoting the integration of Chinese companies into local governance.