Navigating employee rights in Indonesia amid layoffs

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Hello reader,

It’s a pretty scary time to be working in the tech space. Every day, there’s news that another company is conducting layoffs – we’ve got two already in our Quick Bytes section today.

These recent layoffs have also brought many other things to the surface, such as employee rights. How much severance is one entitled to? How long a notice period should an affected employee be given? Is it technically even legal for a startup to just cut jobs like that?

This topic has become especially pertinent in Indonesia, which has significantly more stringent labor laws than other countries. My colleague Ardi unpacks this more in today’s premium story feature.

Today we look at:

• The rights of employees in Indonesia in the face of tech layoffs
• An agritech management firm that’s just raised funds
• Other newsy highlights such as Line Man Wongnai’s potential acquisition of Foodpanda in Thailand and layoffs at Shipper and JD.id

Premium summary

Know your rights

Image credit: Timmy Loen

With staff cuts happening all over the tech scene, it’s essential that workers are aware of their legal rights in the event that they are affected. In Indonesia, the recent wave of tech layoffs has brought these employee rights into the spotlight.

• Rules, rules, rules: According to the relevant government regulations in Indonesia, employees must receive a notice period of at least 14 days before their termination goes into effect. Employees also cannot be let go without their agreement and consent. Severance packages, meanwhile, should be appropriately calculated based on the worker’s years of service and the proposed reason for the layoff.
• Gray areas: But it’s not all black and white. The notice period can be slashed in exchange for monetary compensation. And having mutual agreements on a severance package that is independent of what is mandated by the regulations is a way for employers to “balance all needs” in the face of labor laws that may be limiting for startups that are running out of options.
• Last resort: Beyond the regulations, there’s also a cultural and human element at play when executing staff cuts. It is essential that there’s a channel of communication within the organization and that management is transparent about the difficulties the business is going through.

Read more: Tech layoffs in Indonesia shine light on employee legal rights

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