These are the “Permanent Employees” and “Hired Employees” schemes in the Job Creation Act on page all

JAKARTA, KOMPAS.com – The government and the DPR changed the labor contract scheme in the Employment Creation Law. In the Omnibus Law on Cipta Kerja, article 59 of Law Number 13 Year 2003 is eliminated. This article regulates the limits of the Specific Work Time Agreement (PKWT).

PKWT is a work agreement between a worker and an employer or company to establish an employment relationship for a specific time or for a specific type of work.

The PKWT agreement also regulates the position or position, salary or salaries of workers, what benefits and facilities workers obtain and other matters that regulate personal labor relations.

Companies can only enter into a non-permanent contractual employment contract for a maximum of 3 years. After that, companies are obliged to appoint workers or day laborers as permanent employees if they want to employ them after a period of 3 years.

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The Minister of Manpower (Menaker) Ida Fauziyah, explained that the time limit scheme of the contract will be regulated in derived regulations such as Government Regulations (PP). However, the discussion will continue to consider contributions from employers and unions.

According to Ida, if the maximum limit of a PKWT contract for 3 years is regulated as in Law Number 13 of 2003, it will be inflexible and burdensome for the business world. He gave an example, the PKWT could be extended to more than 5 years.

“It could be more than five years (the deadline of the contract). It could be less. The dynamic is very high. If it is regulated directly in the law, we fear that we will not be able to follow this dynamic,” Ida said. Daily kompas, Monday (10/19/2020).

“We have agreed together with friends in the tripartite forum (government, businessmen and workers), this will be discussed in the formulation of government regulations (PP). So, the government is not going to fill it alone,” he said again.

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Follow other countries

He reasoned that Article 59 regulating the deadline for the PKWT was abolished because the Employment Creation Law adheres to flexibility. It is also common practice in other countries to make it easy for investors to do business.

“We learn from various countries. If it is regulated in law, there will be no regulatory flexibility. This issue is not simple when the dynamics of the workforce is high,” he said.

He said the Job Creation Law would open up more job opportunities due to the many conveniences that the business world could enjoy.

“Actually, we prioritize labor-intensive industries. The hope is that they can absorb more people in a quick time. We also need labor-intensive industries because the level of education and skills of the workforce is still high. low. We need industries that don’t require too high skills, “Ida explained.

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Although it applies to all companies operating in Indonesia, the Job Creation Act is actually focused on providing more opportunities for labor-intensive industries.

Ida affirms that with the approval of the Employment Creation Law, job opportunities will increase, as well as the protection of workers.

“Some businesses that will be relocating are labor intensive on average. Hopefully, they can see that through the Job Creation Bill, the climate is trying to improve, permits are made easier and at the same time, we are also trying to improve the competence of our workforce, “explained Ida.

For information, the obligation to name the employee status after going through the contract period and contract extension of PKWT is carried out because companies can only do PKWT once for an employee (contract employee).

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When 2 years have passed or they are extended for 1 year, the company has only two options, namely not to extend the employment contract or to appoint him as a permanent employee.

“Fixed-term work agreements based on a certain period of time can be maintained for a maximum of 2 (two) years and can only be extended 1 (one) time for a maximum period of 1 (one) year, “the sound of article 59 subsection (1) of Law No. 13 of 2003.

Meanwhile, in the Draft Law on Job Creation, article PKWT of Law Number 13 of 2003 was eliminated.

“The provisions of article 59 are deleted., “the sound of the Draft Law of Creation of Works that has been ratified in the Law of Creation of Works.

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