When it comes into force, the wide-ranging legislation will reduce some of the generous worker entitlements that discourage foreign investors.
The World Bank has swung its support behind the bill, which it describes as “a major reform effort to make Indonesia more competitive” that can support resilient economic recovery and long-term growth.
At home, though, the government faces stiff and rowdy opposition. Trade unions have vowed to get the bill overturned and this week called on the political parties who share their concerns to join the fight.
So far, though. it’s the two civic Islamic groups, with networks that extend across the country, that appear to have had the most influence.
The Muhammadiyah central leadership said on Wednesday the President would consider options for revision and postponement. However, Mr Joko is steadfastly refusing requests to issue a Perppu, or decree, that would invalidate the new law.
Trade unions took to the streets again this week to protest the changes and plan to do so again next month. Said Iqbal, President of the Indonesian Trade Union Confederation (KSPI), told reporters on Wednesday the 32 federations and confederations represented by the KPSI had called on parliament to conduct a review of the legislation with a view to “cancelling it through constitutional means and procedures”.
The KSPI wants the two political parties in parliament who are opposed to the bill to drive the review. Mr Iqbal said it wasn’t enough for them to “hide behind” mass actions.
“If they really support workers, PKS and the Democratic Party must take a political stance according to the constitution,” he said.
KSPI’s plan is unlikely to succeed, observers say. Andry Satrio Nugroho, researcher from Jakarta based Institute for Development of Economics and Finance (INDEF), said the only sure way was to issue a Perppu to invalidate the law – and the President won’t allow that.
Students have joined with unions to protest the laws. Like their counterparts in Thailand who have taken to the streets to demand constitutional reform, they are worried about job security.
Abubakar Siddik, 23, a final-year student at university in Jakarta, said the new law would undermine workers’ rights.
“Students feel obliged to defend workers’ rights and the interests of society. This is not only a threat to those working now but also for students and their future,” Mr Abubakar said. “Students worry that the Job Creation Bill will invite trouble later on.”
Meanwhile, Indonesia’s Democratic Party has been forced to deny speculation it took advantage of protests against the labor law by inciting violence to turn people against the government.
Police say they have proof some of those involved in violent protests in central Jakarta earlier this month were neither workers or students. There’s long been an anarchist element to street protests in Jakarta that some have speculated has links to those who want to roll the clock back to the Suharto era. President Suharto ruled for three decades before he was deposed in 1998. He died 10 years later.
Police arrested more than 1000 people at the October 10 protest in Jakarta where there was substantial damage to public property. Some 167 were held for questioning and 96 are still behind bars, according to Wawan Hari Purwanto, spokesman for Indonesia’s Intelligence Agency.
He said the investigation into the motivation and affiliation of those still detained continues.