Forced Labor Is Not Just Trafficking: The Gap in Indonesia’s Employment Law

Forced labor is frequently framed as an issue limited to trafficking, criminal networks, or severe exploitation.

This is not the case.

Forced labor can occur within standard employment relationships, involving typical workers, factories, and legitimate businesses.

This distinction matters because the legal issue is not just poor treatment, but whether work is imposed without genuine consent under threat of penalty.

The European Union’s Forced Labor Regulation has brought renewed attention to that question. The Regulation prohibits products made with forced labor from being placed or made available on the EU market or exported from the EU, and it applies from 14 December 2027.

For Indonesia, this is more than a market-access issue. It presents an opportunity to address a more fundamental question:

Does Indonesian law provide a sufficiently clear and effective framework for identifying, preventing, investigating, remedying and sanctioning forced labor?

Indonesia has already made an international commitment.

Indonesia has ratified the ILO Forced Labor Convention, 1930 (No. 29), and the Abolition of Forced Labor Convention, 1957 (No. 105).

Convention No. 29 defines forced labor as work or service exacted from a person under the menace of any penalty and for which that person has not offered themselves voluntarily. The ILO therefore identifies two central elements: involuntariness and coercion through a menace of penalty.

This distinction is critical.

A person may enter employment voluntarily and lawfully and still later find themselves in circumstances where leaving, refusing work, or withdrawing their consent carries consequences they cannot realistically avoid.

The legal question is therefore not limited to whether the worker agreed to the job.

It also includes:

“Is the worker still genuinely free to refuse the work or leave it?”

Forced labor extends beyond trafficking.

While trafficking and forced labor can overlap, they are distinct concepts.

A worker does not have to be trafficked across a border to experience forced labor. The ILO recognizes forced labor as a distinct concept that can occur through coercive practices within employment, including situations involving private employers or individuals.

For example, an employer may retain a worker’s original passport or identity document.

Question whether the employer needs to hold the original document. An identity document does not, by itself, establish forced labor. But the ILO identifies withholding identity documents as a potential indicator because it can restrict a worker’s freedom and contribute to coercion. Workers should generally have access to their documents, and retention should not constrain their ability to leave.

The central issue is control.

The document itself is not the forced labor. The question is whether its retention contributes to a coercive situation in which the worker is no longer genuinely free to leave.

Unpaid overtime can present similar concerns.

If a factory misses its production target or workers must correct a mistake, they may be required to stay after normal hours, sometimes without additional pay.

Coercion may not involve explicit threats. It can manifest through economic vulnerability, where refusing extra hours risks wage loss, disciplinary action, or termination.

That is where excessive or unpaid overtime can become relevant to forced labor.

The issue is not solely whether overtime was paid.

It is whether the worker was genuinely free to refuse the work without facing a penalty, and withholding wages is one circumstance that can contribute to forced labor, depending on the surrounding facts.

So an overtime violation and forced labor are not the same legal issue. But where excessive or unpaid work is imposed through coercion, the conduct may move beyond an ordinary working-time or wage dispute and become evidence of forced labor.

Recruitment fees may also indicate forced labor.

Recruitment fees are charged to obtain a job-sometimes through a broker, recruitment intermediary, or an individual involved in the hiring process rather than through any formal company policy.

To pay the fee, the worker may have to borrow money and begin employment already carrying a debt.

The process is straightforward: the recruitment fee creates debt, the debt creates dependence on the job, and that dependence can make leaving difficult or impossible.

Debt itself is not automatically forced labor. But accumulated or recruitment-related debt can become part of a coercive situation where it restricts a worker’s genuine freedom to leave. The ILO recognizes debt bondage and fraudulent or coercive debt as circumstances associated with forced labor.

For this reason, recruitment fees can serve as an indicator.

The issue is not only whether a worker paid a fee, but whether the resulting debt and circumstances compel the worker to remain employed against their genuine will.

The domestic legal gap does not stem from a lack of legislation.

Indonesia already has laws addressing parts of the problem: trafficking, exploitation, employment relationships, wages, working time, recruitment, and labor protection are regulated through different legal instruments.

Therefore, the issue is not that Indonesia lacks laws relevant to forced labor, but that it does not define forced labor as a distinct employment-law concept with a clear, consistently applicable legal test.

That test should begin with the core elements of Convention No. 29:

Was work or service being exacted from the person without genuine voluntary consent, under a menace of penalty?

Both elements matter.

Lack of genuine voluntariness concerns whether the worker has freely and knowingly agreed to the work and remains genuinely free to withdraw.

Menace of penalty concerns the consequence attached to refusing the work or attempting to leave. It need not be physical violence. Depending on the circumstances, it can include threats, dismissal, withholding wages, financial penalties, restriction of movement, retention of identity documents, or other forms of coercive pressure.

This is why individual labor violations must be distinguished from forced labor.

Unpaid wages are not automatically forced labor.

Excessive overtime is not automatically forced labor.

Recruitment fees are not automatically forced labor.

Retention of identity documents is not automatically forced labor.

They become legally significant when the facts show that such practices are being used, individually or together with other circumstances, to deprive the worker of genuine freedom to refuse or leave the work.

This legal distinction must be clearly defined.

The ILO’s 2023 Indonesia situation and gap analysis examined how Indonesia’s existing laws, policies, practices, and enforcement mechanisms reflect international forced-labor standards, identifying both areas of conformity and gaps.

A stronger domestic framework should therefore establish clear rules for:

• the legal elements of forced labor;
• assessing voluntariness, coercion and menace of penalty;
• using indicators as evidence or warning signs, without treating any single indicator as conclusive;
• identifying forced-labor risks in recruitment and employment;
• labor inspection, investigation and referral;
• protection and effective remedies for affected workers; and
• appropriate sanctions where forced labor is established.

The objective is not to classify every labor violation as forced labor. Instead, it establishes a precise legal test that enables workers, employers, and authorities to distinguish ordinary labor violations from conduct that constitutes forced labor.

Why statutory clarity matters- in the legal system, statutory clarity matters because legislation provides the legal basis for rights, obligations, administrative powers, offenses and sanctions.

A clear forced-labor framework would not replace laws dealing with trafficking, wages, working time, recruitment or employment contracts.

It would give those laws a clearer legal relationship to a distinct violation:

work that is not genuinely voluntary and is exacted under a menace of penalty.

This clarity is essential for all stakeholders, including workers, employers, recruiters, labor inspectors, prosecutors, and courts.

An indicator can trigger scrutiny.

The legal test determines whether the threshold has been crossed.

The EU has increased the pressure. Indonesia should respond by enacting appropriate legislation.

The EU Forced Labor Regulation will increase scrutiny of forced labor in global supply chains and create consequences for products connected to forced labor within the EU market.

For Indonesia, the response should go beyond protecting market access.

Indonesia already has the international commitment. It has ratified the relevant ILO conventions. The task now is to translate those commitments into a coherent domestic framework that reflects Indonesia’s own legal system, labor market, and enforcement realities.

Forced labor should not be addressed only when an Indonesian product reaches the European border. It becomes a problem as soon as a worker loses the genuine freedom to leave. Indonesia has already committed to international standards by ratifying the ILO Forced Labor Conventions. The next step is to give this commitment real force in Indonesian law, ensuring workers are protected not just to meet overseas market demands, but because Indonesia itself upholds these protections.