Understanding the Merger Regulation in Indonesian Law

Oct 13, 2025 by thesweetdesigns.com 102 views

# Merger (merger) of Limited Liability Companies in Indonesia and their Impact on Workers

As Indonesia continues to experience rapid economic growth, the business landscape in the country is undergoing significant transformations. One of the notable phenomena that has emerged is the increase in the number of limited liability companies that are carrying out mergers or mergers. This action not only involves business aspects but also has a substantial impact on stakeholders, particularly workers. In this context, it is essential to understand the regulation regarding mergers in applicable laws in Indonesia, the impact caused by workers, as well as a form of protection that can be given to them as a result of the merging of limited liability companies.

Understanding the Merger Regulation in Indonesian Law

Mergers of Limited Liability Companies in Indonesia are regulated comprehensively in Law No. 40 of 2007 concerning Limited Liability Companies and Implementation Regulations. This merger can only be carried out by limited liability companies, and must follow certain procedures, including making agreements in the form of authentic deeds compiled by notaries. The combination process will be valid if approved by the Minister of Law and Human Rights and does not conflict with the company's articles of association. If there is no change in the articles of association, the company only needs to notify the relevant ministers.

Key Points to Note:

The merger regulation in Indonesian law is comprehensive and requires limited liability companies to follow specific procedures.
The combination process must be approved by the Minister of Law and Human Rights and does not conflict with the company's articles of association.
If there is no change in the articles of association, the company only needs to notify the relevant ministers.

The Impact of Merging on Workers

The impact of the merger of a limited liability company can be divided into two categories: positive and negative impacts. On the positive side, workers who remain employed after mergers have the potential to get a higher salary, as well as the opportunity to work in a bigger and more famous company. This can even reduce unemployment in the community.

However, there are also negative impacts that cannot be ignored, namely Termination of Employment (PHK). In this case, workers who are laid off are only entitled to receive severance pay, work award money, and rights replacement money. John Rawls, a philosopher, reminded that injustice will occur when there are actions that benefit a group of individuals but harm other parties. Therefore, the step of dismissal of workers only to maximize shareholder profits is an unethical action.

Key Points to Note:

The impact of the merger of a limited liability company can be divided into two categories: positive and negative impacts.
Workers who remain employed after mergers have the potential to get a higher salary and work in a bigger and more famous company.
Workers who are laid off are only entitled to receive severance pay, work award money, and rights replacement money.

Post-Contest Workers Protection

The form of protection for workers who are re-employed by the company who do the merger is a guarantee to be received again with rights and obligations that do not harm them. As for workers who experience layoffs, they are entitled to severance and compensation in accordance with applicable regulations. However, based on the theory of justice John Rawls, this protection is still considered unfair. This is because the merging made for the efficiency and profit of a handful of people often has a detrimental impact on employees affected by the decision.

Key Points to Note:

The form of protection for workers who are re-employed by the company who do the merger is a guarantee to be received again with rights and obligations that do not harm them.
Workers who experience layoffs are entitled to severance and compensation in accordance with applicable regulations.
The protection given to workers is still considered unfair based on the theory of justice John Rawls.

Conclusion

The merger of a limited liability company in Indonesia has a complex impact on workers. Although there is an opportunity to improve working conditions for some workers, the risk of dismissal remains a real threat. Therefore, it is important for all relevant parties, including the government, companies, and trade unions, to jointly create regulations and policies that can protect the rights of workers during and after the merging process takes place. With the right approach, it is hoped that this merger can provide balanced benefits for all parties, without sacrificing the welfare of workers.

Key Points to Note:

The merger of a limited liability company in Indonesia has a complex impact on workers.
The risk of dismissal remains a real threat for workers.
It is essential for all relevant parties to jointly create regulations and policies that can protect the rights of workers during and after the merging process takes place.
Frequently Asked Questions (FAQs) about Merger of Limited Liability Companies in Indonesia and their Impact on Workers

As the merger of limited liability companies in Indonesia continues to gain attention, many individuals and organizations have questions about the process and its impact on workers. In this article, we will address some of the most frequently asked questions (FAQs) about the merger of limited liability companies in Indonesia and their impact on workers.

Q: What is the purpose of the merger of limited liability companies in Indonesia?

A: The purpose of the merger of limited liability companies in Indonesia is to create a more efficient and competitive business entity that can better serve the needs of its stakeholders, including shareholders, employees, and customers.

Q: What are the benefits of the merger of limited liability companies in Indonesia for workers?

A: The benefits of the merger of limited liability companies in Indonesia for workers include the potential for higher salaries, better working conditions, and more opportunities for career advancement. Additionally, workers who remain employed after the merger may have access to more comprehensive benefits and perks.

Q: What are the risks of the merger of limited liability companies in Indonesia for workers?

A: The risks of the merger of limited liability companies in Indonesia for workers include the potential for job loss, reduced benefits, and changes to working conditions. Additionally, workers who are laid off may face challenges in finding new employment and may experience financial difficulties.

Q: How do workers who are laid off as a result of the merger of limited liability companies in Indonesia receive compensation?

A: Workers who are laid off as a result of the merger of limited liability companies in Indonesia are entitled to receive severance pay, work award money, and rights replacement money in accordance with applicable regulations.

Q: What is the role of the government in regulating the merger of limited liability companies in Indonesia and protecting the rights of workers?

A: The government plays a crucial role in regulating the merger of limited liability companies in Indonesia and protecting the rights of workers. The government has established laws and regulations that govern the merger process and provide protections for workers, including the right to severance pay and other benefits.

Q: How can workers who are affected by the merger of limited liability companies in Indonesia seek support and protection?

A: Workers who are affected by the merger of limited liability companies in Indonesia can seek support and protection by contacting their trade union or other worker organizations, as well as by seeking advice from a lawyer or other professional advisor.

Q: What is the future of the merger of limited liability companies in Indonesia and its impact on workers?

A: The future of the merger of limited liability companies in Indonesia and its impact on workers is uncertain. However, it is likely that the merger process will continue to evolve and that workers will face both opportunities and challenges as a result of the merger.

Q: How can the merger of limited liability companies in Indonesia be made more beneficial for workers?

A: The merger of limited liability companies in Indonesia can be made more beneficial for workers by implementing policies and practices that prioritize the well-being and interests of workers, such as providing comprehensive benefits and perks, offering training and development opportunities, and ensuring that workers are treated fairly and with respect.

Q: What is the role of trade unions in protecting the rights of workers during the merger of limited liability companies in Indonesia?

A: Trade unions play a crucial role in protecting the rights of workers during the merger of limited liability companies in Indonesia. Trade unions can provide support and representation to workers who are affected by the merger, as well as advocate for policies and practices that prioritize the well-being and interests of workers.

Q: How can the government and companies work together to protect the rights of workers during the merger of limited liability companies in Indonesia?

A: The government and companies can work together to protect the rights of workers during the merger of limited liability companies in Indonesia by implementing policies and practices that prioritize the well-being and interests of workers, such as providing comprehensive benefits and perks, offering training and development opportunities, and ensuring that workers are treated fairly and with respect.

Q: What is the impact of the merger of limited liability companies in Indonesia on the economy and society as a whole?

A: The impact of the merger of limited liability companies in Indonesia on the economy and society as a whole is complex and multifaceted. On the one hand, the merger can lead to increased efficiency and competitiveness, which can benefit the economy and society as a whole. On the other hand, the merger can also lead to job loss and other negative consequences for workers and communities.

Q: How can the merger of limited liability companies in Indonesia be made more sustainable and beneficial for all stakeholders?

A: The merger of limited liability companies in Indonesia can be made more sustainable and beneficial for all stakeholders by implementing policies and practices that prioritize the well-being and interests of workers, customers, and the broader community, such as providing comprehensive benefits and perks, offering training and development opportunities, and ensuring that workers are treated fairly and with respect.