Labor Placement

The placement of labor into the workforce in foreign locales has and continues to be an issue for Indonesia as it seeks to protect migrant workers from the excesses and abuses exacted upon them while overseas. However, the placement of local labor into the domestic labor market is also of critical importance and the previous regulatory framework dated back to 1990.

The Minister of Labor and Transmigration has issued Regulation No. PER.07/MEN/IV/2008 to replace Minister of Labor Decision Nos. KEP.207/MEN/1990 and KEP.203/MEN/1999. The previous decisions have been deemed to be out-of-date and not reflective of current labor practices and needs in Indonesia in 2008. The basis for the Regulation can be found in Articles 36(2) and 37 of the Labor Law (Law No. 13 of 2003). A further consideration in the Regulation is the requirements contained in Article 9(1) of Government Regulation No. 38 of 2007 specifically as that provision relates to regional autonomy.

Labor placement is defined simply as the processes of providing services to job seekers and employers in order to fill vacancies as they arise in the labor market. The regulatory framework here as it relates to labor placement constitutes a part of the much broader Single National Labor Market.

Labor placement activities will be undertaken by either the government or the private sector. The government will be spread across the three nominal levels of government; Central, Provincial, and District / Cities. The central government has primary responsibility for developing and implementing policy, providing information on the national labor market, provide guidance at and from a national level, and put into place control mechanisms for expatriate labor to ensure that expatriate labor is utilized in a manner beneficial to Indonesia.

Breaches of the provisions of the Regulation attract the standard administrative sanctions.

The Regulation has been in force since 21 April 2008.