Foreign Investment Must Be Supported by Employment Law Compliance
Foreign investment is still considered one of the key drivers of Indonesia’s economic growth. However, the sustainability of investment must also be supported by compliance with labour regulations to create healthy industrial relations and provide certainty for all parties.
Ahmad Ansyori, Vice Chairman II of the Indonesian Association of Labour Law Lecturers and Practitioners (P3HKI), stated that worker protection and legal certainty are crucial elements in maintaining the quality of investment in Indonesia. According to him, compliance with labour regulations not only protects workers but also provides certainty for business actors.
“It is about ensuring they (foreign investors) do not only look at the financial perspective of an investment while ignoring other matters, which we might call a denial or disregard for legal principles in Indonesia,” Ansyori said during a discussion on “Foreign Investor Compliance with Labour Law in Indonesia” in Jakarta on Tuesday (9/6/2026).
Ansyori believes that strengthening labour compliance must continue to be encouraged in line with the increase in foreign investment across various sectors. This step is important to ensure that investment growth goes hand in hand with the protection of workers’ rights and the creation of harmonious industrial relations.
According to him, several ongoing labour issues can serve as joint evaluation material for the government, business actors, and other stakeholders to strengthen the supervision system and law enforcement.
P3HKI has proposed a mechanism that can drive corporate compliance with labour regulations, including in the execution of corporate actions such as mergers, acquisitions, and divestments.
“For example, a mechanism where, if there is to be a corporate action, a merger, or an acquisition, there is a requirement we call a Certificate of Labor Compliance,” Ansyori said.
Public Policy Expert from Trisakti University, Trubus Rahardiansah, stated that legal certainty is an important factor in maintaining public and investor confidence in Indonesia’s business climate. Therefore, the execution of legal rulings and the resolution of labour disputes must receive attention from all parties.
“Legal certainty is a crucial factor in building public trust in the investment climate,” Trubus said.
Meanwhile, the Director of Industrial Relations Dispute Resolution at the Directorate General of PHI and Social Security for Employment at the Ministry of Manpower, Arnando Jujur Pardamean Siregar, emphasised that investment and worker protection need not be pitted against each other. The two must run in parallel to create inclusive economic growth.
“We hope that investment will drive economic growth while simultaneously creating jobs that will have an impact on public welfare. Good investment is not only profitable but also law-abiding and respectful of workers’ rights,” Arnando said.
The discussion highlighted the importance of building an investment climate that is not only competitive but also based on legal certainty and respect for workers’ rights. In this way, investment can provide wider benefits for the business world, the workforce, and the national economy.