Apindo Urges Latest Labor Law to Make Indonesia an Investment Destination
JAKARTA, KOMPAS.com - The Indonesian Employers Association (Apindo) is pushing for the revision of the Labor Law to turn Indonesia into an attractive destination for investment.
"We hope that our law can compete with those of other ASEAN countries and regions so that once again, we can become a prime investment destination," said Apindoβs Head of Labor Affairs, Bob Azam, in an interview with Kompas.com on Thursday (17/9/2026).
Apindo believes that the criminal sanctions proposed in the latest Labor Bill, which is still under discussion with the Indonesian House of Representatives (DPR RI), could deter foreign investors looking to invest in Indonesia.
If criminal penalties are indeed included in the new Labor Law, Apindo fears foreign investors will hesitate to expand their business in Indonesia.
Should this occur, Indonesia will suffer losses and workers risk losing their jobs.
"True worker protection is having a job itself. If thereβs no job, what is there to protect?" he added.
Bob Azam also criticized the current Law Number 13 of 2003 on Manpower for setting too many high barriers, causing many investors to avoid Indonesia.
He pointed out that many investors who have already invested in Indonesia have pulled out because of this law.
"Take labor-intensive industries, for example. Our manufacturing contribution has dropped from 25 percent in 2003 when Law Number 13 was enacted, to 19 percent now. If we exclude palm oil (CPO), it's down to 16 percent," he explained.
The exit of numerous investors has caused many workers in labor-intensive sectors to lose their jobs.
Apindo views that the law, which was designed to protect workers, ironically causes them to lose jobs and struggle to support their families.
For this reason, Apindo hopes the new Labor Law will be truly fair to both workers and employers to foster healthy economic growth.
It is worth noting that the DPR RI is currently revising the Labor Law to strike a balance between workers and employers.
The bill draft has already been submitted to the government, labor unions, and employers.
The DPR is also inviting all stakeholders to provide feedback on the draft Labor Bill.
