Said Iqbal: No More Outsourcing in Private Mining and Oil & Gas Sectors

Jakarta, CNBC Indonesia - Special Presidential Adviser for Employment and Labour Welfare Said Iqbal has revealed that the government is finalising new rules regarding the use of outsourced labour. Under the scheme currently being discussed, private mining and oil and gas companies will no longer be permitted to use outsourced workers. This is because private firms are considered to have high levels of profitability and operations concentrated in a single location. “Private mining and oil and gas service companies cannot use outsourcing because their profits are quite high and they are in one location,” Said stated during a virtual press conference on Sunday (28/6/2026). He noted that irregularities in the use of outsourced labour are still found in several mining industrial areas, such as Morowali, Konawe, and at certain nickel mining companies managed by Chinese investors. Unlike private companies, Said explained that state-owned enterprises (BUMN) will still be allowed to use outsourced labour. However, these outsourced workers must be employed through a BUMN subsidiary, rather than through foundations or labour supply companies, as has often been the case. Under this scheme, the employment relationship of outsourced workers will be directly under a BUMN subsidiary. Workers can be hired as contract employees (PKWT) or permanent employees (PKWTT). “We hope to decide this by mid-July 2026. Companies will be given six months, so it will not be massive, and the private sector cannot do it arbitrarily,” he said.