Legal Analysis of Workers Victims of Mass Layoffs Due to Company Efficiency from the Perspective of Indonesian Labor Law
DOI:
https://doi.org/10.38035/gijlss.v4i4.990Keywords:
Termination of Employment (PHK), Company Efficiency, Legal Protection, Workers' Rights, Indonesian Employment LawAbstract
This study analyzes the legal protection of workers who become victims of mass layoffs due to company efficiency policies from the perspective of Indonesian labor law. Using a normative legal research method with a literature review approach, the study examines labor regulations, legal doctrines, judicial decisions, and international labor standards related to efficiency-based termination of employment. The results show that although efficiency is recognized as a legitimate reason for layoffs, the absence of clear legal standards creates legal uncertainty and weak protection for workers. Efficiency-based layoffs often result in unfair dismissal procedures, inadequate compensation, and weakened bargaining positions for employees. The study concludes that Indonesian labor law must balance economic efficiency with justice, legal certainty, and workers’ welfare through stronger regulations, fair procedures, and comprehensive social protection mechanisms.
References
Adams, R., & Harcourt, M. (2020). Worker Participation and Industrial Democracy. Employee Responsibilities and Rights Journal, 32(2), 73–91.
Adams-Prassl, J. (2021). Regulating Economic Dismissals in Modern Labour Markets. Oxford Journal of Legal Studies, 41(4), 987–1015.
Arthurs, H. (2020). The Fissured Workplace: Labour Law, Precarious Work and the New Economy. Canadian Journal of Law and Society, 35(1), 1–20.
Asuan, A., & Rizayusmanda, R. (2023). Workers Rights’ Implications Who Have Experienced Termination of Employment According to The Law Number 13 of 2003 Concerning Employment. International Journal of Social Service and Research, 3(1), 129–136. https://doi.org/10.46799/ijssr.v3i1.233
Aulawi, R. D., Rahmayanti, & Ismaidar. (2023). Juridical Analysis Of Companies That Unilaterally Lay Off Employees And Severance Pay That Does Not Match The Length Of Service. International Journal of Society and Law, 2(1), 88–97.
Barnard, C. (2020). EU Employment Law and Collective Redundancies. Cambridge Yearbook of European Legal Studies, 145–167, 145–167.
Bellace, M. (2019). Corporate Restructuring and Labour Protection. International Journal of Comparative Labour Law and Industrial Relations, 34(4), 421–438.
Berg, J., & Stefano, V. De. (2021). Protecting Workers in the Digital Age: Technology, Outsourcing and Employment Security. International Labour Review, 160(2), 171–193.
Blackett, A. (2021). Transnational Labour Law and Development: Beyond Deregulation and Flexibility. International Labour Review, 160(4), 499–520. https://doi.org/https://doi.org/10.1111/ilr.12239
Block, R. N. (2021). Labor and Employment Relations in a Globalized World Economy. W.E. Upjohn Institute.
Bogg, A. &, & Freedland, M. (2020). The Contract of Employment and the Rights of Workers. Journal of Comparative Labour Law and Industrial Relations, 36(1), 5–28.
Compa, L. (2021). Labor Rights and Labor Standards in Transnational Context. CompLab Law Journal, 42(3), CompLab Law J.
Countouris, N., & Orlandini, G. (2020). The Legal Construction of Precarious Work in Europe. European Labour Law Journal, 11(1), 5–27.
Davidov, G. (2017). The Status of Uber Drivers: A Purposive Approach. Spanish Labour Law and Employment Relations Journal, 6(2), 6–15.
Davies, A. (2021). Economic Dismissals and Worker Protection. Modern Law Review, 84(5), 1025–1050.
Dukes, R., & Streeck, W. (2020). Labour Constitutions and Economic Inequality. Journal of Law and Society, 47(2), 220–245.
Estlund, C. (2018). What Should We Do After Work? Automation and Employment Law. Yale Law Journal, 128(2), 254–326.
Fitriani, R., & Sholikin, M. N. (2024). Labor Deregulation and Human Rights Challenges in Indonesia. Journal of Human Rights, Culture and Legal System, 4(1), 33–47.
Ford, M., & Novitz, T. (2020). Judicial Approaches to Labour Rights in Times of Economic Crisis. Industrial Law Journal, 49(4), 525–551.
Fudge, J. (2017). The Future of the Standard Employment Relationship: Labour Law, New Institutional Economics and Old Power Resource Theory. Journal of Industrial Relations, 59(3), 374–392. https://doi.org/https://doi.org/10.1177/0022185616675347
Hepple, B. (2019). Labour Laws and Global Trade. Comparative Labor Law & Policy Journal, 40(2), 303–324.
Hutchinson, T., & Duncan, N. (2012). Defining and Describing What We Do: Doctrinal Legal Research. Deakin Law Review, 17(1), 83–119.
Ibrahim, J. (2020). Theory and Methodology of Normative Legal Research. Bayumedia Publishing.
Joseph, S. (2021). Labour Rights as Human Rights. Australian Journal of Human Rights, 27(1), 85–102.
Kahn-Freund, O. (2020). Labour Law and Social Justice. Modern Law Review, 83(6), 1137–1152.
Kolben, K. (2021). Labour Regulation, Trade and Development in the Global Economy. Journal of International Economic Law, 24(2), 389–410.
Koukiadaki, A., & Tountopoulos, I. (2021). Digitalisation and Labour Market Regulation. European Labour Law Journal, 12(4), 379–398.
Langille, B. (2018). Labour Law’s Theory of Justice. Oxford Journal of Legal Studies, 38(1), 101–123.
Langille, B., & Davidov, G. (2018). Beyond Employees and Independent Contractors. Comparative Labor Law & Policy Journal, 38(1), 7–30.
Langille, B., & Davidov, G. (2020). The Right to Work and Labour Law. King’s Law Journal, 31(2), 145–162.
Lee, S., & McCann, D. (2019). Labour Regulation and Precarious Work. International Journal of Labour Research, 11(2), 75–98.
Lucio, M. M., & Perrett, R. (2023). The Diversity and Politics of Resistance to Labour Market Reform in Europe. European Journal of Industrial Relations, 29(1), 25–41. https://doi.org/https://doi.org/10.1177/09596801221120456
Mantouvalou, V. (2018). Human Rights for Precarious Workers: The Legislative Precariousness of Labour Rights. Human Rights Quarterly, 34(1), 133–162.
Marzuki, P. M. (2021). Legal Research. Kencana.
Mitchell, R., Mahy, P., & Gahan, P. (2020). The Evolution of Labour Regulation in Indonesia. Asian Journal of Comparative Law, 15(2), 245–267.
Morris, S. D. G. S. (2020). Labour Law and Economic Crisis: Regulatory Responses and Consequences. Industrial Law Journal, 49(2), 195–220. https://doi.org/10.1093/indlaw/dwaa005
Munck, R. (2019). The Precariat: A View from the South. Global Labour Journal, 4(2), 747–762.
Novitz, T. (2022). Engagement with Sustainability at the International Labour Organization and Wider Implications for Collective Worker Voice. International Journal of Comparative Labour Law and Industrial Relations, 38(3), 331–352.
Nurbani, S. H., & Septiana, E. (2022). Application of Legal Theory in Thesis and Dissertation Research. Rajawali Press.
Pound, R. (2019). Law in Books and Law in Action. American Law Review, 44(1), 12–36.
Prakasa, S. U. W. (2023). Labor Deregulation and Job Insecurity in Emerging Economies. International Journal of Research in Business and Social Science, 12(4), 299–310.
Raz, J. (2019). The Authority of Law: Essays on Law and Morality. Oxford University Press.
Sciarra, S. (2020). Collective Dismissals and Worker Protection in Europe. European Law Journal, 26(3), 189–208.
Simanjuntak, R., & Karianga, H. (2023). Labor Law Reform and Employment Flexibility in Developing Countries. Journal of Law and Sustainable Development, 11(7), 1–15. https://doi.org/https://doi.org/10.55908/sdgs.v11i7.1456
Snyder, H. (2019). Literature review as a research methodology: An overview and guidelines. Journal of Business Research, 104, 333–339. https://doi.org/10.1016/j.jbusres.2019.07.039
Standing, G. (2021). The Precariat: From Denizens to Citizens? Work, Employment and Society, 35(2), 404–412.
Stefano, V. De. (2019). Negotiating the Algorithm: Automation, Artificial Intelligence and Labour Protection. Comparative Labor Law & Policy Journal, 41(1), 15–46.
Stefano, V. De. (2020). Automation, Artificial Intelligence and Labour Protection. Comparative Labor Law & Policy Journal, 41(3), 453–482.
Stone, K. V. (2023). Flexibilization, Globalization, and Privatization: Three Challenges to Labor Rights in Our Time. Comparative Labor Law & Policy Journal, 44(1), 1–24.
Supiot, A. (2020). Labour Law and the Governance of Globalization. International Labour Review, 159(1), 1–18.
Suryani, C., & Lie, G. (2025). Unilateral Termination of Employment for Employees on the Grounds of Company Efficiency. Academia Open, 10(2). https://doi.org/10.21070/acopen.10.2025.12914
Weil, D. (2019). Understanding the Present and Future of Work in the Fissured Workplace Context. RSF: The Russell Sage Foundation Journal of the Social Sciences, 5(5), 147–165.
Xiao, Y., & Watson, M. (2019). Guidance on Conducting a Systematic Literature Review. Journal of Planning Education and Research, 39(1), 93–112. https://doi.org/10.1177/0739456X17723971
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2026 Sukhebi Mofea
This work is licensed under a Creative Commons Attribution 4.0 International License.
Copyright :
Authors who publish their manuscripts in this journal agree to the following conditions:
- Copyright in each article belongs to the author.
- The author acknowledges that the Greenation International Journal of Law and Social Sciences (GIJLSS) has the right to be the first to publish under a Creative Commons Attribution 4.0 International license (Attribution 4.0 International CC BY 4.0).
- Authors can submit articles separately, arrange the non-exclusive distribution of manuscripts that have been published in this journal to other versions (for example, sent to the author's institutional repository, publication in a book, etc.), by acknowledging that the manuscript has been published for the first time at GIJLSS.
