Amendment to Kadin Law Strengthen KADIN's Role in Promoting Workers' Welfare

The amendment to Law No. 1 of 1987 on Indonesian Chamber of Commerce and Industry (“KADIN”) (“Law 1/1987”) will strengthen KADIN’s role in improving workers’ welfare. Chairman of the Legislative Body of Indonesia’s House of Representatives (“DPR RI”), Bob Hasan, stated that the amendment positions KADIN as a suprastructural institution with a status equivalent to that of a state institution. Through this role, KADIN is expected to promote a people-oriented economic paradigm that provides greater support for workers.

Bob explained that a people-oriented economic paradigm does not merely view workers as employees who receive wages. Rather, this paradigm views workers as partners in industrial development. “We are no longer talking about workers who are paid only according to the Regional Minimum Wage (“UMR”), but about how these workers can transition into partners so that they can earn incomes significantly above the UMR,” Bob said.

He further explained that, as a suprastructural institution, KADIN has greater flexibility and is not constrained by rigid jurisdictional boundaries, thereby enabling it to explore economic opportunities and develop a more dynamic business ecosystem.

Through this amendment to the Law, Bob hopes that KADIN will become more agile in creating business models that can elevate workers into partners, thereby increasing their income and welfare. “Therefore, KADIN must be able to position itself structurally in relation to the responsibilities entrusted to it, both in the industrial and trade sectors. It is no longer a matter of discussing entities, but rather functions,” he said.