The term Omnibus Law is now widely discussed in Indonesia. This is because the Indonesian Government has drafted an Omnibus Law whose ultimate goal is to encourage national economic growth. One of the Omnibus Laws that has been formalized is Law 11 of 2020 on Job Creation. Let's get to know more about Omnibus Law and one of them is studying Law 11 of 2020 on Job Creation in the Employment cluster.
2. What are the regulations/ laws that will be drafted using the Omnibus Law method?
3. What is the background of the government to make the Omnibus Law?
4. What is the purpose of the Omnibus Law?
5. What are the benefits of the Omnibus Law?
6. Scope of Omnibus Law Law No.11/2020 on Job Creation
Omnibus law is a method or concept of making regulations that combine several rules with different regulatory substances into one regulation under one legal umbrella. The regulations made are always carried out to make new laws by canceling or revoking as well as amending several laws and regulations at once.
The concept of Omnibus Law the law aims to target major issues that allow the revocation or amendment of several laws at once (across sectors) to then simplify the regulation so that it is expected that there will be no concurrency/dispute and/or resistance between one norm and another.
When viewed from its position, the Omnibus Law as a law is below the basic law, but higher than other types of legislation.
The omnibus law that will be made by the Government of Indonesia will target 3 major laws (UU), namely the Job Creation Law, the MSME Empowerment Law, and the Tax Law.
The reason for the government to make an Omnibus Law is that there are too many regulations made, which then creates its own problems, such as overlapping regulations. As a result, there are many conflicts of policy or authority between one ministry/agency and another ministry/agency, and also between the Central Government and Regional Governments.
These overlapping regulations have ultimately hampered the implementation of development programs and worsened the investment climate in Indonesia. This makes it difficult to achieve development acceleration programs and improve people's welfare.
At the same time, the challenges of the digital society ecosystem era are also growing, and Indonesia can no longer be entangled by formal procedures. Based on this, the only way to simplify and uniformize regulations quickly is through the Omnibus Law scheme.
The Omnibus Law, which will be pushed in the form of 3 major laws, the Job Creation Law, the MSME Empowerment Law, and the Tax Law, can be a tool to strengthen the national economy by improving Indonesia's investment ecosystem and competitiveness.
Some other objectives of the Omnibus Law are :
- Improving a conducive and attractive business climate for investors
- Increase Indonesia's economic growth
- Increase legal certainty and encourage the interest of foreign nationals to work in Indonesia which can encourage the transfer of skills and knowledge for the quality of Indonesian human resources
- Encourage voluntary compliance of taxpayers (WP) and create business justice between domestic business actors and foreign business actors.
The existence of the Omnibus Law is believed to provide a number of benefits, including:
- Eliminating overlaps between laws and regulations, and uniformity of central and regional policies in supporting the investment climate.
- The efficiency of the process of changing/revoking laws and regulations, it is believed that it will save government energy both in terms of administration and politics in discussions with Parliament
- Eliminating sectoral ego contained in various laws and regulations.
This law (UU) came into force on November 2, 2020. It aims to regulate work creation efforts that are expected to be able to absorb the widest possible Indonesian workforce in the midst of increasingly competitive competition and the demands of economic globalization.
Job Creation is an effort to create jobs through efforts to facilitate, protect, and empower cooperatives and micro, small, and medium enterprises, improve the investment ecosystem and ease of doing business, and Central Government investment and acceleration of national strategic projects. The ten scopes of this Law are:
1) improvement of the investment ecosystem and business activities;
2) employment;
3) ease, protection, and empowerment of cooperatives and MSEs;
4) ease of doing business;
5) research and innovation support
6) land acquisition;
7) economic zones;
8) Central Government investment and acceleration of national strategic projects;
9) implementation of government administration; and
10) imposition of sanctions.
Consists of:
- PP 34/2021 on Foreign Workers
- GR 35/2021 on Fixed-Term Employment Agreement, Working Time, Employment Relationship, Rest Period, and Termination of Employment Relationship
- PP 36/2021 on Minimum Wage
- PP 37/2021 on Worker's Compensation (JKP)
Related information:
- https://gajimu.com/garment/Labour-Law-in-Garment/omnibus-law/wage-regulation
- https://gajimu.com/garment/Labour-Law-in-Garment/omnibus-law/formula-of-minimum-wage-calculation-based-on-gr-36-2021
- https://gajimu.com/garment/Labour-Law-in-Garment/omnibus-law/the-job-loss-insurance-jkp
Source:
- Copy of Law No. 11 of 2020 on Job Creation
- Ministry of Finance of the Republic of Indonesia
- Indonesia.go.id - Indonesia Information Portal
- Online Law
- Online Tax
- Suara.com