COMPENSATION AND INDUSTRIAL HARMONY IN THE GIG ECONOMY ERA: A NEW CHALLENGE FOR HUMAN RESOURCE MANAGEMENT IN INDONESIA
DOI:
https://doi.org/10.58174/ijimes.v1i6.111Keywords:
compensation, gig economy, industrial relations, human resource management, platform workers, algorithm, procedural justiceAbstract
Compensation is the human resource management instrument most directly experienced by workers; however, the emergence of the gig economy has fundamentally shifted the conventional logic of wages, benefits, and fairness perceptions at work in a global context. According to the International Labour Organization (ILO), more than 1.9 billion informal workers worldwide face income uncertainty and minimal social protection, a figure that continues to rise with the expansion of digital platform economies (ILO, 2021). In Indonesia specifically, the proportion of gig workers has increased from 7.3 million in 2019 to 15.2 million in 2023, encompassing ride-hailing drivers, platform-based freelancers, and logistics couriers whose compensation varies without legally binding minimum standards. This article aims to comprehensively analyze how compensation systems for gig workers in Indonesia affect the creation of industrial harmony, and to identify emerging challenges faced by human resource management practices in designing fair compensation within flexible, algorithm-mediated work relationships. The methodology combines quantitative and qualitative approaches through a systematic literature review of 25 accredited national and international journal articles (2021–2025), analysis of labor statistics from the Central Bureau of Statistics (BPS) and the Ministry of Manpower Indonesia, and examination of applicable labor regulations. Findings indicate that algorithmic incentive-based compensation schemes place gig workers in a vulnerable position with income fluctuating 35–45% monthly on average, absence of minimum wage protection, and limited access to social security, thus significantly increasing potential industrial disharmony. The study identifies algorithmic transparency, worker community involvement in social dialogue, and development of sui generis legal frameworks as essential prerequisites for balancing work flexibility with decent work principles. The study concludes that human resource management in the gig economy requires a renewed compensation paradigm based on procedural and distributive justice, and necessitates multi-stakeholder coordination to create a sustainable and inclusive platform work ecosystem in Indonesia.
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