KSPI Denies That Abolishing Outsourcing Will Trigger Mass Layoffs

JAKARTA, KOMPAS.com - The Indonesian Confederation of Trade Unions (KSPI) has denied the notion that abolishing the outsourced labour system or outsourcing would trigger mass layoffs.

KSPI President Said Iqbal assessed that the issue was deliberately propagated to intimidate the government and employers into not prohibiting outsourcing.

“So it is not true that outsourcing will lead to large-scale layoffs. That is nonsense and a monster created to scare employers and the government,” Said stated when met on the sidelines of a demonstration at the Ministry of Manpower, Jakarta, on Thursday (7/5/2026).

That scheme, according to him, would allow companies to retain options without having to use outsourced labour or appoint all workers as permanent employees.

“And once again, it is not true that abolishing outsourcing will result in layoffs; that is untrue,” Said remarked.

Said, along with hundreds of workers, visited the Ministry of Manpower to demand revisions to Ministerial Regulation on Employment (Permenaker) No. 7 of 2026 on Outsourced Workers.

That regulation does indeed limit the use of outsourced workers to certain fields. However, KSPI believes there are still clauses that are too flexible and could potentially cause problems.

Said highlighted the provisions regarding support services for operations that are still permitted to use outsourced workers.

“And you all know that corruption in the Ministry of Manpower occurs because of ambiguous clauses like this: the occupational health and safety clause is ambiguous, leading to corruption; the foreign worker clause is ambiguous, leading to corruption. Well, outsourcing is the same,” he said.