Employment Contract Terminated Unilaterally by the Company

Abstract

An employment relationship is a formal relationship between an employer and an employee based on an employment contract. In reality, this relationship does not always run smoothly. One of the main issues that frequently occurs in the employment sector is unilateral termination of employment (PHK) by companies against employees, especially contract workers who are still bound by a fixed-term employment agreement (PKWT). This problem causes legal uncertainty and injustice for employees, because termination of employment should be carried out in accordance with applicable legal provisions. Employers who terminate employment without valid reasons are considered to have violated existing laws, particularly Articles 61 and 62 of Law Number 13 of 2003 concerning Manpower, which was amended by Law Number 11 of 2020 concerning Job Creation. This study aims to understand the forms of legal protection for contract workers whose contracts are unilaterally terminated by companies, analyze the company's responsibilities regarding workers' rights, and explain the dispute resolution mechanism in industrial relations in the event of unilateral layoffs. The method used in this study is normative legal research using a legislative approach and a conceptual approach. The data sources used are secondary data, including laws and regulations, legal references, and court decisions related to the industry. The results of this study indicate that unilateral layoffs of contract workers are illegal if carried out without a valid reason. Employers are required to provide compensation in the form of wages until the contract expires, as well as other benefits in accordance with the provisions of Article 156 of Law Number 13 of 2003. In addition, workers have the right to file legal remedies through bipartite channels, mediation, conciliation, and even to the industrial relations court.