KSPI Deems Sanctions in 2026 Outsourcing Labour Regulation Ineffective in Deterring Companies
JAKARTA, KOMPAS.com - The Indonesian Confederation of Workers’ Unions (KSPI) assesses that the sanctions in Ministerial Labour Regulation (Permenaker) No. 7 of 2026 on outsourced or alih daya workers do not provide a deterrent effect for companies.
KSPI President and Labour Party President, Said Iqbal, stated that the sanctions stipulated in the regulation are not strong enough to prevent violations.
“Indeed, there are administrative sanctions in Permenaker No. 7 of 2026. What are administrative sanctions? It’s unclear,” he said during a press conference via Zoom on Monday (4/5/2026).
According to him, this situation indicates a lack of deterrent effect for violating companies.
“It could be a first warning letter, oh, they use outsourcing. Second warning, they use outsourcing even longer. Third warning, outsourcing is already exhausted before they comply,” he explained.
Said Iqbal mentioned that previous regulations, namely Law No. 13 of 2003 on Manpower and Permenaker No. 19 of 2012, provided firmer legal consequences.
He explained that under those rules, if a company violates the provisions on the use of outsourced workers, the employment relationship of the workers automatically shifts to a direct relationship with the employer.
“What does that mean? The law protects. If they have a direct relationship with the employer, then the workers’ rights in case of termination of employment or layoffs emerge,” he said.
“They get severance pay, health insurance, pension guarantees, work accident insurance, old-age guarantees,” he continued.
According to Said Iqbal, the sanction mechanism in the old regulations provides a greater deterrent effect compared to the administrative sanctions in the latest Permenaker.
Previously reported, the Indonesian Confederation of Workers’ Unions (KSPI) has requested a revision of Ministerial Labour Regulation (Permenaker) No. 7 of 2026 on outsourced workers (outsourcing) because it is deemed to contradict the Constitutional Court (MK) decision.
This was stated by KSPI President and Labour Party, Said Iqbal, during a press conference session via Zoom on Monday (4/5/2026).
“Permenaker No. 7 of 2026 on outsourced workers must be revised. Because its content contradicts the order of Constitutional Court Decision No. 168 of 2024, the lawsuit of which was won by the Labour Party, KSPI, KSPSI Andi Gani, and FSPMI,” he said in that press conference session.