Page 71 - e-KLIPING KETENAGAKERJAAN 25 FEBRUARI 2020

Looking at the media sector, for instance, a stipulation that foreign investors can
only own media companies through a stock market mechanism -- such as buying
news organizations' shares in an initial public offering -- has been amended.

Article 11 in Law No. 40/1999 on the press now loosely states that the "central
government will develop the press through investment according to investment laws
and regulations".

Labor reform

Overall rights for severance payments, beyond basic allowances, are either set to be
reduced or scrapped completely, even though the calculation for basic severance
pay remains unchanged.

Rigid calculations on rights for severance payments, payments for recognition of
length of service (UPMK) and compensation for rights (UPH) that are differentiated
based on reasons for the lay-off, as stipulated in articles 161 to 172 in the prevailing
Law No. 13/2003 on manpower, are all going to be scrapped. Instead, the omnibus
bill on job creation only requires employers to make severance payments and the
UPMK according to the employees' length of service.

Expatriates will be allowed to work in more functions than only diplomatic affairs, as
stipulated in Article 42 of the Manpower Law. In the omnibus bill, foreign workers
will be allowed to work in Indonesia without a permit in positions that range from
members of boards of directors and commissioners, and diplomatic or consular staff,
to researchers and emergency engineers. Foreign workers in start-ups will also be
exempted from work-permit requirements.

Outsourcing requirements are to be significantly relaxed under the omnibus bill, as
Article 66 of the Manpower Law that prohibits outsourced employees from
undertaking more than a core task in a company is to be revised. The omnibus bill
will open the possibility for outsourcing institutions to hire workers for various tasks,
including freelance and full-time workers.

Further, labor-intensive industries will not have to adhere to regional minimum
wages and the governors of respective provinces may use different formulas in their
calculations. More details will be covered in a separate PP, according to the draft
bill. Micro and small businesses are exempted from minimum-wage stipulations but
must pay their workers above the poverty line rate.

The prevailing Article 93 that stipulates workers' rights for paid leave under certain
circumstances has been deleted from the omnibus bill. The circumstances currently
covered include paid leave of three days when workers get married, two days when
their children are circumcised or baptized or get married, or when their wives are in
labor or undergoing an abortion. Workers whose family members pass away get one
to two days' unpaid leave in the current regulation.

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