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Business uncertainty likely result of jobs law ruling
House of Representatives is preparing amendment process that will include omnibus law in Indonesia's legal system.
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Severe migraine: A student protester holds up a poster based on the packaging design of a headache medicine on October 8. 2020 during a demonstration on Jl. M.H. Thamrin in Central Jakarta. The poster reads: “The omnibus law causes headaches, environmental damage, workers’ oppression.” (JP/Seto Wardhana)
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egal experts and economists warned on Friday that it will take time to revise and analyze the landmark 2020 Job Creation Law, the key legislative item in the government’s reform agenda, and that lengthy process would create a degree of legal uncertainty that could affect business confidence.
Legal experts interpret the court’s decision to mean that the government and the House will have to deliberate the Job Creation Law from scratch or even invalidate the law with all its derivative regulations, which would have knock-on effects on business activity.
“This would definitely have an impact on the economy, but I think that's a consequence and risk of completely ignoring good law-making procedures,” Susi Dwi Harijanti, a constitutional law professor at Bandung’s Padjadjaran University, told The Jakarta Post on Friday.
Bivitri Susanti, a constitutional law expert at the Jentera School of Law in Jakarta, pointed out that there were other judicial review petitions challenging the Job Creation Law in the pipeline, which should also be monitored, as those could affect the revision process, if the Constitutional Court approved those petitions.
“The House and the government should carefully study the court argument to improve the legislation process for the Job Creation Law, as mandated by the ruling, so that it complies with all principles of a good-lawmaking process,” said Bivitri.
Read also: Court orders revision of jobs law
Similarly, Citibank economist Helmi Arman said in a client note that “It cannot be ruled out that certain investment decisions or corporate actions may be delayed while legal experts analyze the implications of this court ruling,” as reported by Reuters.
