Realizing Employment Justice Through the Outsourcing Elimination Plan

By: Andi Ramadhan

President Prabowo Subianto’s commitment to eliminate the outsourcing system marks a new chapter in the national employment journey. In commemoration of Labor Day on May 1, 2025, the President expressed his determination to form a National Labor Welfare Council which will be a strategic advisor to the government in formulating the direction of employment policy. This step is not merely a political response, but a real representation of the state’s awareness of the importance of creating justice and job security for all Indonesian workers.

For more than two decades, the outsourcing system has been part of the modern employment landscape. Initially, this scheme was expected to provide flexibility for the business world in responding to market dynamics. However, in practice, outsourcing often creates uncertainty of employment status, wage stagnation, and minimal access to career paths. Not a few workers have been in a circle of short-term contracts for years, without certainty of appointment and without guarantees of long-term welfare.

Minister of Manpower Yassierli revealed that outsourcing practices in the field have caused many problems. One of them is workers who are over 40 years old but still have the status of outsourced workers, paid equivalent to the Provincial Minimum Wage (UMP), and without a clear career path. This situation indicates a structural inequality in work protection. Therefore, the elimination of this system cannot be postponed any longer.

Steps to eliminate the outsourcing system certainly cannot be done haphazardly. The elimination of outsourcing will be carried out with well-planned steps, as emphasized by President Prabowo Subianto. In the midst of a dynamic investment climate, this policy requires strategic planning in order to maintain the trust of the business world while protecting workers’ rights. In this context, the role of the National Labor Welfare Council is very crucial as a bridge between workers’ aspirations and industry needs.

The elimination of outsourcing does not mean closing the space for work flexibility. On the contrary, this is a starting point for the formation of a fairer, more transparent, and more productive work system. The balance between the interests of workers and the business world can be achieved if regulations are designed inclusively, involving all stakeholders, and strengthening the function of labor supervision. The government has a central role in ensuring that this transition process takes place without creating new uncertainty in the labor sector.

This step also shows the government’s strong commitment to the principle of decent work as stated in the Sustainable Development Goals (SDGs). Indonesia has a moral and constitutional responsibility to ensure that all workers receive protection, opportunities to develop, and equal recognition for their contribution to national economic development. By eliminating outsourcing, the space to empower domestic workers will be wider and of better quality.

This policy also has the potential to strengthen the competitiveness of the national workforce. In the era of industrial transformation and digitalization, Indonesian workers need certainty of status to be able to participate in training, vocational education, and continuous capacity building. Outsourcing, in many cases, has become an obstacle for workers to move up a class. By eliminating this system, the space for vertical mobility in the world of work will be more open and promising.

From the perspective of the business world, the elimination of outsourcing can actually encourage stability and loyalty of the workforce. Workers who feel appreciated and have career prospects tend to show higher productivity. In the long term, this will have a positive impact on the operational efficiency of the company. The business world will also find it easier to design HR development strategies because certainty of work status creates more harmonious industrial relations.

On the other hand, strengthening the labor supervision system is a primary prerequisite so that this policy does not stagnate at the discourse level. The government needs to ensure that the implementation of the elimination of outsourcing is not replaced by other inappropriate work practices, such as a recurring contract system without a time limit. Reform in the labor supervision and law enforcement system is absolutely necessary so that every policy runs according to its objectives.