Wave of Layoffs Continues: PT Samwon Lays Off 685 Workers and Five Limestone Factories in West Bandung Halted

PT Samwon Busana Indonesia has officially ceased its business operations in Jepara as of 1 August 2026. The South Korean-owned garment company closed down due to continuous losses, resulting in the termination of employment for 685 workers. Head of the Cooperatives, SMEs, Manpower, and Transmigration Office of Jepara Regency, Zamroni Lestiaza, confirmed that the company is no longer operational. ‘As of 1 August, the factory in Jepara is no longer operational, it has closed,’ he stated in an interview on Tuesday (4/8/2026). According to Zamroni, PT Samwon has fulfilled its obligations to the affected workers. ‘Everything was settled on 31 July as initially planned. The total number of workers is 685,’ he said. He explained that in fulfilling the workers’ severance rights, the company used Government Regulation No. 35/2021, a derivative regulation of the Job Creation Law. The multiplier used to determine the amount of severance pay was 0.5 (0.5 × years of service × monthly wage). Zamroni acknowledged that PT Samwon, a foreign investment company from South Korea, had requested legal certainty regarding the layoffs. This was due to a Constitutional Court ruling that declared the Job Creation Law conditionally unconstitutional. ‘Essentially, they asked for certainty, what is the legal certainty like in Indonesia? Why are there differences? So, until the very end, there was no explanation they could use as a reference. Therefore, they adhered to the provisions of Government Regulation No. 35,’ Zamroni said. Nevertheless, Zamroni claimed that all workers accepted the severance pay provided by PT Samwon. However, he admitted he did not know the exact amount paid by the company. ‘For that matter, you might need to ask the management,’ he said. According to Zamroni, his office has registered the affected PT Samwon workers. The Jepara Regency Government will assist them in finding new job vacancies. ‘But because this is still early days, the workers might not immediately look for new jobs. Some have said they want to rest first,’ he stated. Previously, PT Samwon Busana Indonesia’s Chief of Exports and Imports, Tri Harti, stated that the decision to close the factory in Jepara was due to declining market demand. This condition has been felt since the Covid-19 pandemic. Tri said the factory’s production in Jepara, which originally reached around 700,000 pieces of clothing per month, dropped to around 125,000 pieces per month. The company’s products are mainly marketed to the United States, South Korea, China, and Dubai.