Constitutional Court Extends Statute of Limitation for Industrial Dispute Claims Submission by Employees
On September 17, 2025, the Constitutional Court (the “Court“) rendered its decision in Case No. 132/PUU-XXIII/2025 (the “Decision”). The case relates to the judicial review of Law No. 2 of 2004 dated January 14, 2004 (effective January 14, 2005) on Industrial Relation Dispute Settlements (“Law 2/2004”).
The petitioner, an employee whose employment had been terminated on October 31, 2023 (the “Petitioner”), sought a judicial review of Article 82 of Law 2/2004. The Petitioner contended that this Article, which had gone under judicial review twice prior to this, violates his constitutional rights according to the 1945 Constitution of the Republic of Indonesia (the “Constitution”), and as such deems the Article to be in direct conflict with the Constitution.
We set out below the key arguments of the Petitioner and the Decision of the Court.
♦ Petitioner’s Argument
The Petitioner argues that Article 82 of Law 2/2004, which reads as follows:
“a claim from employee over employment termination may be filed only within 1 (one) year since the decision had been received or notified by the employer,”
imposes an unreasonable statute of limitation for the filing of claims over employment termination by employees.
The Petitioner further explains that the statute of limitation fails to account for disadvantages that render employees unable to take action within a short time period, such as financial pressure, lack of legal knowledge, lengthy mediation or conciliation negotiation processes, and dependence of documents from the employer. Furthermore, the Petitioner argues that Article 82 of Law 2/2204 favors uncooperative employers who choose to delay the process in order to entirely avoid claims from employees whose employment is terminated.
Based on the abovementioned, the Petitioner states that Article 82 of Law 2/2004 conflicts with the right to fair legal certainty and special treatment ensuring equality as set out in Article 28D paragraph (1) and Article 28H paragraph (2) of the Constitution respectively. Further, the Petitioner proposes that Article 82 of Law 2/2004 must be interpreted as “a claim from employee over employment termination may be filed only within 3 (three) year since the [termination] decision is received or notified by the employer.”
♦ Court Decision
Considering the Petitioner’s argument, the Court acknowledges that the 1 (one) year limitation indeed caused legal uncertainty and inequality. The Court then partially grants the petition by first rejecting the Petitioner’s proposed interpretation and continuing by ruling that Article 82 of Law 2/2004 must be interpreted as “a claim by an employee regarding termination of employment may only be filed within a period of 1 (one) year from the failure to reach an agreement in mediation or conciliation negotiations.”
♦ Impact of Decision
The Court’s decision grants employees significantly more time to challenge employment terminations, since the countdown now begins after mediation or conciliation fails, rather than from the termination notice by an employer.
AKSET
Please contact Johannes C. Sahetapy-Engel (jsahetapyengel@aksetlaw.com), Thomas P. Wijaya (twijaya@aksetlaw.com), or Giorgio Alexander William Robot (grobot@aksetlaw.com) for further information.
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