WORK AGREEMENT SYSTEM (OUTSOURCING) FOR EMPLOYEES USING THE WORK CONTRACT SYSTEM (PKWT)

Abstract

The increasingly competitive business environment has encouraged companies to implement outsourcing systems as an operational efficiency strategy. One of the most widely applied employment relationships within outsourcing is the Fixed-Term Employment Agreement (Perjanjian Kerja Waktu Tertentu/PKWT). Although this system has been regulated under Indonesian labour law through Law Number 13 of 2003 concerning Manpower as amended by Law Number 6 of 2023 concerning Job Creation and Government Regulation Number 35 of 2021, its implementation continues to raise various legal issues, particularly concerning the protection of workers' rights.This research aims to analyze the legal framework governing outsourcing employment agreements using fixed-term employment contracts and to examine the legal protection afforded to outsourced workers under Indonesian positive law. The study employs normative legal research using statutory, conceptual, and analytical approaches.

The research concludes that the post-Job Creation Law regulatory framework provides greater flexibility for companies in implementing outsourcing practices. Nevertheless, legal protection remains mandatory through regulations governing wages, social security, occupational safety and health, compensation for fixed-term employment agreements, and industrial dispute settlement mechanisms. In practice, however, several obstacles remain, including the improper use of fixed-term contracts, weak labour supervision, and low compliance by certain companies with labour regulations. Therefore, stronger government supervision and more effective labour law enforcement are required to achieve a balance between investment interests and workers' legal protection.