INDONESIA Law and Practice Contributed by: Lia Alizia, Jonathan Andreas Sitorus and El Yefta Akwila, Alizia & Partners Law Office
4. Protection of the Parties During an HR Internal Investigation 4.1 Protection of the Reporter The employer must take necessary steps to protect the reporter from any harm or threat during the inves - tigation process, as it is the employer’s obligation to safeguard the rights of their employees as stipulated in the Indonesian Manpower Law. Although Indonesian law does not provide specific regulations on the approaches or measures to pro - tect a reporter, in practice, employers generally adopt several protective actions. These may include imple - menting remote work arrangements (such as a work- from-home mechanism), garden leave (suspension), temporarily reassigning the reporter to another unit of work during the course of the investigation, and/or providing psychological assistance or counselling to ensure the reporter’s well-being. The Indonesian Manpower Law requires employers to create a supportive work environment that guarantees the safety of the individual during their duties, to pro - tect his/her moral and personal rights and to protect against discrimination. This requirement extends to the protection of reporters (whistle-blowers) who are also employees. Moreover, the Human Rights Law affirms the right of each citizen to safeguard himself or herself from threats and intimidation. Potential Adverse Consequences Failure to protect whistle-blowers would be classified as an employer infringing on employees’ rights. Con - sequently, the employer could be held responsible if it does not protect these rights. Legal consequences could include a suit with the Industrial Relations Court if there are infringements of labour rights and possible administrative fines from authorities including, but not limited to, the Ministry of Manpower or the Financial Services Authority ( Otoritas Jasa Keuangan OJK), which oversees institutions in the banking, capital markets and insurance sectors, and requires internal investigations in cases of suspected fraud as part of its mandatory anti-fraud compliance framework. In addition to legal risk, employers will face other potential risks if they fail to protect whistle-blowers.
These include damage to the employer’s reputation and loss of trust between co-workers due to insuf - ficient measures of confidentiality. Such non-legal risks can significantly affect workplace dynamics and overall trust in the organisation. Protecting the reporter is good business practice, allowing the reporter to work to the best of their ability and make impartial decisions. However, there could potentially be adverse consequences for an employer that takes measures to protect the reporter. • Perceived bias or unfairness: another employee or person involved in the investigation could see the employer as being biased in favour of the reporter, leading to claims of unfair treatment or retaliation against other employees. • Impact on workplace dynamics: protection strate - gies (re-designating a reporter, decreasing com - munication between the parties) may have some effect on normal working relationships, create resentment among colleagues and, therefore, harm the productivity and morale of working groups in general. • Confidentiality risks: Trying to protect, say, the identity or role of the reporter could lead to leaks or rumours, which can breach confidentiality or complicate the investigation. • Resource and administrative burden: Taking protective steps, such as a short period of leave, transfer of supervision or adjusted working duties consumes administrative resources. • Risk of overprotection: A possible risk of overpro - tecting the reporter is legal liability for the employer and potential claims of retaliation, discrimination or a lack of due process. Employers usually avoid such risks by enshrining its rules in writing, being honest and impartial about what is going on, communicating honestly (within the bounds of confidentiality) and acting reasonably and proportionately in any protection efforts it undertakes. When well-managed, protecting reporters’ rights usu - ally allows for a fair investigation process and is con - sistent with legal and ethical norms.
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