Borobudur Law and Society Journal

Dismissal puts a worker's income and security most at risk, and the rules on how it must be carried out and contested have changed considerably since Law No 13 of 2003 was enacted. This article examines how disputes over termination of employment are settled in Indonesia and how the rights of dismissed workers are fulfilled under the law in force in October 2026. It is a normative legal study that uses statutory, conceptual and case-law approaches, drawing on Law No 13 of 2003 as amended by Law No 6 of 2023, Government Regulation No 35 of 2021, Law No 2 of 2004, Constitutional Court Decision No 168/PUU-XXI/2023 and the literature. The study finds that the former requirement of a prior determination by the dispute-settlement institution has been replaced by notification and bipartite negotiation, and that the Constitutional Court has restored the rule that a contested termination takes effect only after a final and binding decision, while wages and rights continue. Severance, service award and entitlement compensation depend on length of service and on the ground of termination, but obtaining them requires a long path through negotiation, mediation or conciliation, trial and cassation, and execution is weak. The article recommends that the new labour legislation adopt the Court's reading, shorten the pre-litigation stage and regulate execution.