JAKARTA, INDONESIA – The Indonesian government has strengthened the protection for outsourced workers, along with the jobs that can be outsourced, through the Manpower Ministerial Regulation No. 7 of 2026 on Outsourced Employment.
According to the Minister of Manpower, Yassierli, this regulation follows the 2023 Constitutional Court Decision No. 168/PUU-XXI, which imposes restrictions on outsourced work.
The Minister also adds, “This policy aims to provide legal certainty, strengthen the protection of workers’ rights, and at the same time, maintain business continuity.”
What We Know of This Regulation
In a report by ANTARA News, the Manpower Ministerial Regulation No. 7 of 2026 on Outsourced Employment will:
- Limit the type of outsourced work to specific areas: cleaning services, food and beverage services, security services, driver provision and worker transportation, operational support services, and supporting work in the mining, oil and gas, and electricity sectors.
- Employers are required to have a written agreement with outsourcing companies, which must include the type of work being outsourced, duration, work location, number of workers, labor protection, and the rights and obligations of the parties.
- Outsourcing companies must fulfill all workers’ rights according to laws and regulations, including wages, overtime pay, working hours and rest periods, annual leave, occupational safety and health, social security for health and employment, religious holiday allowances, and severance pay rights.
What This Means for Multinational Companies Operating in Indonesia
The new regulation reaffirms the government’s “commitment to promote harmonious, transformative, and fair industrial relations with the spirit of advancing the industry and ensuring worker welfare,” notes Minister Yassierli.
This signals multinational companies to push toward compliance and accountability in their outsourcing practices. While it may increase their administrative responsibilities, such as reviewing that all outsourced roles fall within the permitted areas and verifying workers receive mandated benefits and protections, it also provides them with clearer legal guidelines that can help reduce labor disputes and maintain stable operations in Indonesia.
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