A draft presidential decree in Indonesia would cut ride-hailing commissions to 10% and require platforms to pay full accident insurance for drivers.
JAKARTA: Millions of Indonesian ride-hailing drivers could receive significantly improved financial and social benefits under a draft presidential decree.
President Prabowo Subianto is considering the new rules, which would slash the commission caps platforms can take from drivers to 10% from the current 20%.
The draft decree would also require platforms to pay for drivers’ accident and death insurance in full.
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Companies would additionally have to split health, old-age and pension premiums for industry workers, potentially driving up hiring costs.
An industry source who has seen the draft told Reuters that “most of the players in the industry cannot sustain these changes”.
The source expressed concern that the insurance fees would mean skyrocketing annual spending for companies.
A second source warned that the costs borne by platforms could lower margins and reduce the number of drivers they allow on their platforms.
Such benefits have for years been resisted by companies, which insist drivers are gig workers not eligible for the same insurance as full-time employees.
The draft also authorises the government to review agreements between companies and online transportation workers, and protects the right to unionise.
Prabowo is under pressure to respond to drivers’ demands for better pay and conditions after their involvement in widespread protests in August.
Presidential spokesperson Prasetyo Hadi has labeled drivers “heroes of the economy”.
“Motorcycle taxi drivers have become an increasingly visible political force,” said Siwage Dharma Negara, a senior fellow at the ISEAS-Yusof Ishak Institute.
He said the death of a rider during the August protests intensified public scrutiny of gig workers’ vulnerability.
The debate also comes amid concerns about driver welfare due to a potential merger between Indonesia’s GoTo and Singapore-based rival Grab.
Critics of the deal say it will create a monopoly that will work against drivers.
The decree would also apply to on-demand logistics firms such as Lalamove and J&T Express.
Indonesia led the ASEAN taxi market with a 37% share in 2024, based on its population and rapid uptake of digital payments. – Reuters
