2028 Labour Wage Formula to Change; What About 2027 Minimum Wage Increases?

The Labour Protection Law was officially passed by the House of Representatives (DPR RI) today, Tuesday (6/10/2026). However, the new regulations will not take effect immediately, including the provisions regarding wages.

The Director General of Industrial Relations and Social Security at the Ministry of Manpower, Indah Anggoro Putri, stated that the new law includes a one-year transition period from the date of its enactment. Therefore, the wage regulations applicable to the upcoming period will still refer to the currently existing regulations.

“Next year, we will still use the current Government Regulation, because this law does not take effect immediately upon being passed,” said Indah when met following the ratification of the Labour Protection Law at the Parliament Complex, Jakarta.

Indah explained that the new law will come into force one year after being established and promulgated. Due to this transition period, the new wage-setting rules are only expected to be used for the determination of the 2028 minimum wage.

“One year from being established and promulgated,” she said.

(Will the 2028 Minimum Provincial Wage (UMP) use this new law?) “God willing,” she replied.

Regarding the new Labour Protection Law, there are new provisions concerning wages. One of these is that the Decent Living Standard (KHL) survey will be conducted by the Central Bureau of Statistics (BPS) in consultation with wage councils.

“There will be something new; there will be a KHL survey conducted by BPS, in consultation with wage councils,” Indah explained.

Previously, the Minister of Manpower, Yassierli, had not yet provided certainty regarding the formula for the 2027 minimum wage increase. At that time, the government was still awaiting the results of the discussions on the Labour Protection Bill.

“We have not discussed that yet. Right now, we are focusing on the Labour Protection Bill. So, if there are stakeholders, whether from labour or industry, who convey their aspirations, we will accommodate them,” said Yassierli when met at the BPS Head Office, Jakarta, on Friday (18/9/2026).

Yassierli previously stated that the 2027 wage formula would depend on the final results incorporated into the Labour Protection Law, before the government assesses its implications for existing regulations.

“The formulation will depend on the results written in the Labour Protection Bill. That will be the basis, and then we will subsequently examine the implications for existing regulations together,” he said.