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Aug

18

Labor Law Guide: What You Need to Know in the Event of a Labor Strike in Indonesia

Regulations in Indonesia are very dynamic. This is to create ease for investment to Indonesia. Changes in regulations, specifically in the area of labor issues, can sometimes trigger a conflict between the employer and the laborers, leading to a strike. A strike is an action by laborers that is planned and carried out jointly and/or by a trade union/labor union to stop or slow down work. Strikes by laborers are thankfully not a regular occurrence, but for the industries with a lot of laborers, it can occur at any time there is an employment dispute or a dispute between the employer and the labor union. Strikes are regulated under the Law in Indonesia. Based on the Law No. 13 Year 2003 concerning Manpower ("Law 13/2003"), a strike is allowed, if it is carried out in a lawful, orderly, and peaceful manner, which is a result of the failure of a negotiation regarding a certain issue. Some qualifications that need to be fulfilled when conducting a labor strike according to Law 13/2003 are:

  1. Laborers who are invited to carry out a strike have the right to refuse the invitation.
  2. For the act of a strike that concerns companies that serve the public interest or whose activities are related to the safety of human life, the act of a strike must be regliated so as not to interfere with the public interest and endanger the safety of the community.
  3. There has to be a written notification given no later than seven days prior to the execution of the strike to the company and institution in charge. This includes the time, place and reason for the strike, as well as the signature of persons in charge of the strike.
  4. After receiving the notification, the company or the institution must provide a receipt for the written notification of the strike.
  5. Before and during the strike, the institution concerned must resolve the problems that led to the strike through negotiation. If an agreement is reached, then a signed agreement must be made. However, if the negotiations fail, then the problem shall be referred to the competent industrial relations dispute settlement agency.

In the event of a lawful labor strike, Article 143 of Law 13/2003 regulates that no parties can prevent, arrest, or detain laborers and trade unions/labor unions from exercising their right to strike when carried out in a lawful, orderly, and peaceful manner. Companies are also prohibited under Article 144 of Law 13/2003 from:

  1. Replace striking laborers with laborers from outside the company; or
  2. Using sanctions or countermeasures in any form on laborers and trade union officials/labor unions during and after a strike.

According to Indonesian employment law, failure to comply with the aforementioned qualifications would result in the strike being considered illegal, in accordance with Article 142 of Law 13/2003 and Article 3 of the Decision of the Minister of Manpower and Transmigration No.KEP232/MEN/003 concerning Consequence of Unauthorized Labor Strike. Moreover, such a strike would be considered an absence and not a lawful labor strike. Calls to return to work for the laborer involved in the strike are carried out by the company two times within a seven-day period in the form of proper and written summons. Laborers who do not fulfill this call are deemed to have resigned. In the even of strikes, it is important to know your rights as the employer or employee. Therefore, it is advisable to consult with your attorney, particularly a dispute lawyer. To prevent any strikes by keeping your company updated on regulations, it also advisable for your company to have a permanent legal consultant by hiring a corporate lawyer in Indonesia.

How Schinder Can Help

Schinder Law Firm is a leading corporate law firm in Indonesia, practicing Indonesian Company Law and Indonesian Labor Law. Our team of corporate lawyers in Indonesia and employment law attorneys have forged a reputation for assisting various clients across the globe. As Indonesian corporate lawyers, we have extensive experience providing services in various cases of employment dispute, as well as daily legal advice related to Indonesia Labour Law, including, but not limited to, drafting an Employment Agreement, Company Regulation, and Collective Labor Agreement. If you have inquiries related to labor law issues, please feel free to send a message to: info@schinderlawfirm.com.

Author: Budhi Satya Makmur