Indonesia: government intends to lower redundancy compensation

Indonesia’s national press has reported on a government project to revise rules on mandatory redundancy compensation as part of new draft legislation that aims to make South-East Asia’s largest economy investment environment more attractive. The draft legislation, which should contain several separate provisions, is expected to be submitted in the week starting 17 February. In it will be the intention to lower the ceiling for redundancy compensation from 32 times monthly salary down to 19 times. Other provisions will be related to unemployment insurance and job seeking support. In spite of the paucity of details available, trade unions have already announced demonstrations and are threatening to initiate strike action.