CIPS Urges More Targeted Gig Economy Regulation in Indonesia
The growth of digital economics in Indonesia has driven an increase in project-based or gig workers, including online transport drivers, logistics couriers, and digital freelancers. However, the regulatory framework governing this sector remains fragmented and fails to provide certainty regarding worker status or protections.
The Centre for Indonesian Policy Studies (CIPS), an independent and non-partisan think tank focusing on public policy research and recommendations, addressed this matter in its latest policy brief titled “Navigating the Future of Work: Policy Approaches for Gig Work in Indonesia.”
“Through this publication, CIPS aims to provide analysis and policy recommendations to the government and stakeholders regarding the development of the gig economy in Indonesia and more targeted regulatory approaches to protect workers whilst maintaining innovation in the digital economy,” said Jimmy Daniel Berlianto, Senior Research and Policy Analyst at CIPS.
Gig work, according to Berlianto, is flexible work based on short-term tasks or projects, typically conducted through digital platforms. In Indonesia, this activity is expanding particularly in online transportation, logistics, e-commerce delivery, and digital freelance work such as graphic design, programming, and content writing.
Most visible
Gig workers in the digital transportation sector—such as ride-hailing drivers operating through platforms including inDrive, Gojek, and Grab—represent one of the most visible worker groups in Indonesia’s gig economy development.
“CIPS research notes that the gig economy’s contribution to Indonesia’s economy reached approximately USD 7 billion or approximately 0.62% of Gross Domestic Product (GDP) in 2019. Whilst its contribution remains relatively small, this sector is estimated to continue growing as digital technology usage and platform economies expand,” Berlianto stated.
However, behind these opportunities, some gig workers face unstable working conditions, uncertain income, and limited bargaining power against platforms.
CIPS’s study identified that some platform workers, particularly ride-hailing drivers, fall into “disguised employment” categories—situations where individuals appear to be self-employed but practically work like employees due to heavy dependence on a single employer or platform.
This policy brief emphasises that gig workers cannot be treated as a uniform group. Based on work autonomy levels and bargaining power against platforms or clients, the research identifies four main gig worker categories: disguised employment, dependent self-employment, constrained high-leverage self-employment, and independent self-employment.
Disguised employment describes workers with low autonomy dependent on a single platform. Dependent self-employment refers to self-employed workers heavily reliant on one or a few main clients. Constrained high-leverage self-employment involves highly skilled workers facing limited access to capital, networks, or resources. Independent self-employment represents truly independent work with full control over operations and diverse client sources.
Worker protection
Gig workers in digital sectors such as designers, programmers, and freelance writers tend to have higher autonomy and flexibility levels, requiring policies focused on market access and competitiveness.
Jimmy emphasised that gig work policies should not adopt a one-size-fits-all approach.
“Overly broad regulatory approaches risk hindering the flexibility that constitutes gig work’s primary advantage. Therefore, policies should focus on protecting workers in disguised employment situations, without impeding opportunities and innovation for other gig workers,” he stated.
CIPS recommends that the Indonesian government avoid comprehensive regulatory approaches and instead target protection for gig workers with low autonomy and limited bargaining power. Additionally, CIPS encourages the government to strengthen dispute resolution mechanisms between gig workers and platforms, and to enhance the transparency of algorithms used by digital platforms.
This transparency should encompass information regarding service tariff determination, platform commissions, incentive systems, and penalty mechanisms that can affect worker earnings.
Through more precisely targeted policy approaches, Indonesia is expected to protect vulnerable workers whilst maintaining the dynamic innovation and continued growth of the digital economy.