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Appreciating the Importance of the Job Creation Perppu for the Business World

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By : Putri Dewi Nathania )*

The Perppu on Job Creation which was issued by the Indonesian government some time ago, especially for the business world, is considered important. Not only that, but it also proves how the state is present and really supports economic activities in the country.

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The Omnibus Law on Job Creation was ratified by the Government since the Plenary Meeting of the Republic of Indonesia’s House of Representatives (DPR RI) in 2020. There are many benefits from the passage of the Job Creation Law. Regarding this matter, the Coordinating Minister (Menko) for the economy, Airlangga Hartarto echoed that one of the benefits of the Job Creation Law is to provide protection and also ensure rights for workers or laborers.

Coordinating Minister Airlangga emphasized that the existence of the Job Creation Law shows how the presence of the state is in the form of industrial Pancasila which prioritizes tripartite relations between the Indonesian Government, workers or laborers by issuing a job loss guarantee (JKP).

With that in mind, the state is really trying to be able to continue to be present in relation to guaranteeing workers’ rights. Recently, the Government of Indonesia has also issued Government Regulation in Lieu of Law (Perppu) Number 2 of 2022 concerning Job Creation. According to the Coordinating Minister for the Economy, the issuance of the Job Creation Perppu carried out by the Government has considered many urgent needs.

Indeed, there are many urgent needs, especially in the economic sector, which must be anticipated as soon as possible. One of them is regarding uncertain global economic conditions, ranging from economic turmoil to geopolitical turmoil such as the conflict between Russia and Ukraine.

With all these urgent conditions, according to him, the government must immediately accelerate anticipation so that Indonesia is able to face the threat of a global recession much better. Apart from that, so that the increase in inflation will not be too high in the country and also be able to face the threat of stagflation.

Airlangga Hartarto also added that the Constitutional Court (MK) Decision Number 91/PUU-XVII/2020 regarding the Job Creation Law really has a great influence on the behavior of the business world.

The influence of the Constitutional Court’s decision regarding the Job Creation Law does not only occur on business actors from within the country, but also affects business actors abroad. On the other hand, the Government of Indonesia itself also continues to strive to attract investment.

This is because investment activity in Indonesia itself is one of the keys to national economic growth. Therefore, many parties really hope that the existence of the Job Creation Perppu which has been issued by President Jokowi is truly able to provide legal certainty, especially for business actors.

Furthermore, the Coordinating Minister for Airlangga explained that in 2023 Indonesia is making arrangements for a budget deficit with a target of less than 3 percent, which relies heavily on the smooth running of all investment activities in the country.

With the target to carry out this budget deficit, Indonesia already has an investment target in 2023 of up to IDR 1,200 trillion. With all these urgent matters, of course it is very important that there is correct legal certainty. Therefore, the issuance of the Job Creation Perppu is considered to be a concrete solution because it is able to fill the legal vacuum and at the same time become the implementation of the Constitutional Court Decision.

For information, the issuance of Perppu Number 2 of 2022 concerning Job Creation on December 30 2022 also automatically revises a number of rules in Law Number 11 of 2020 concerning Job Creation. According to the President of the Republic of Indonesia, Joko Widodo, it is important to issue this Perppu because in 2023 the Indonesian economy itself will depend a lot on investment and export activities.

Some of the contents of the Job Creation Perppu make it increasingly important, especially for actors in the business world, namely that there is a minimum wage setting for outsourced workers. Not only that, but the Job Creation Perppu is also able to synchronize Law Number 7 of 2021 concerning Harmonization of Tax Regulations (HPP) and Law Number 1 of 2022 concerning Financial Relations between the Central Government and Regional Governments (HKPD).

In issuing this Perppu on Job Creation, the Government of Indonesia has also made improvements to the substance of resource utilization for the public interest. According to the Coordinating Minister for Airlangga, all of these improvements have been in accordance with the discussions that have been carried out by the relevant ministries/institutions and have also been communicated by academics.

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