Wage Regulation and Worker Welfare: A Comparative Analysis of National Labor Law and Islamic Legal Perspectives
DOI:
https://doi.org/10.64268/jilhs.v1i1.18Keywords:
Decent Living Standards, Islamic Labor Law, National Labor Legislatio, Wage Regulation.Abstract
Background: Regulating wages is critical to ensuring workers receive fair compensation, which directly affects their living standards. In Indonesia, national labor law sets minimum wage standards, while Islamic labor law offers an alternative approach based on ethical principles. This study compares the wage regulation frameworks under Indonesian national labor law and Islamic labor law, focusing on their roles in achieving a decent standard of living for workers.
Aims: This research aims to compare wage determination under Indonesian national labor law and Islamic labor law, evaluating their effectiveness in ensuring a decent living standard for workers. The study also identifies strengths and weaknesses in both systems and explores potential integration for improving worker welfare.
Methods: The study employs a comparative legal research approach, analyzing Indonesia's 2003 Labor Law alongside Islamic labor law derived from the Qur'an, Hadith, and Ijtihad. It uses normative legal research and qualitative analysis based on literature reviews and case studies from relevant sectors.
Results: The comparison shows that while national labor law focuses on economic factors like inflation and minimum wage, Islamic labor law emphasizes moral and social justice. Islamic law ensures that wages meet both economic and ethical standards, incorporating the maqasid al-shari'ah (goals of Islamic law), which aims for fairness and worker welfare.
Conclusion: Both legal systems aim to ensure fair wages, though one is economically driven and the other ethically focused. Combining the strengths of both could lead to a more comprehensive approach, balancing economic efficiency with social justice. Future research should explore how these frameworks can be applied in policy-making to improve worker welfare.
References
Ahyani, H., Muharir, M., Khairuddin, K., Rahman, E. T., Wibowo, D. E., Ulummudin, U., Abduloh, A. Y., Kuncoro, I., & Lousada, S. A. N. (2025). Minimum Wages and Welfare of Private Lecturers in Indonesia: Perspectives of Islamic Law and Positive Law. Abdurrauf Law and Sharia, 2(1), 1–21.
Alfani, M. I., & Sunarno, S. (2024). Comparison of Legal Protection of Labor in Indonesia And Pakistan. Jurnal Suara Hukum, 6(1), 187–205. DOI: https://doi.org/10.26740/jsh.v6n1.p187-205
Allen, E. R. (2016). Analysis of Trends and Challenges in the Indonesian Labor Market. https://hdl.handle.net/1813/87128
Azid, T., Burki, U., Khawaja, M. J., Shirazi, N. S., & Tahir, M. (2022). Labor economics in an Islamic framework: Theory and practice. Routledge. https://api.taylorfrancis.com/content/books/mono/download?identifierName=doi&identifierValue=10.4324/9781032019550&type=googlepdf DOI: https://doi.org/10.4324/9781032019550
Bae, K. B., Sohn, H., Cho, I. H., & Han, D. (2022). Does Knowing Other Workers’ Wage Level Promote Employees’ Pay Fairness Perception? Evidence From a Randomized Survey Experiment. Public Personnel Management, 51(4), 407–429. https://doi.org/10.1177/00910260221098191 DOI: https://doi.org/10.1177/00910260221098191
Betcherman, G. (2015). Labor Market Regulations: What do we know about their Impacts in Developing Countries? The World Bank Research Observer, 30(1), 124–153. https://doi.org/10.1093/wbro/lku005 DOI: https://doi.org/10.1093/wbro/lku005
Buana, M. S., & Budiman, R. (2022a). INDONESIA’S MINIMUM WAGE POLICY AFTER THE OMNIBUS LAW: A COMPARATIVE ANALYSIS FROM ISLAMIC PRINCIPLES. UUM Journal of Legal Studies, 13(2), Article 2. https://doi.org/10.32890/uumjls2022.13.2.8
Buana, M. S., & Budiman, R. (2022b). Indonesia’s minimum wage policy after the Omnibus Law: A comparative analysis from Islamic principles. 13(2), 187–214.
Buana, M. S., & Budiman, R. (2022c). INDONESIA’S MINIMUM WAGE POLICY AFTER THE OMNIBUS LAW: A COMPARATIVE ANALYSIS FROM ISLAMIC PRINCIPLES. UUM Journal of Legal Studies, 13(2), Article 2. https://doi.org/10.32890/uumjls2022.13.2.8 DOI: https://doi.org/10.32890/uumjls2022.13.2.8
Clibborn, S., & Hanna-Osborne, S. (2023a). The employer perspective on wage law non-compliance: State of the field and a framework for new understanding. Industrial Relations: A Journal of Economy and Society, 62(4), 411–438. https://doi.org/10.1111/irel.12333
Clibborn, S., & Hanna-Osborne, S. (2023b). The employer perspective on wage law non-compliance: State of the field and a framework for new understanding. Industrial Relations: A Journal of Economy and Society, 62(4), 411–438. https://doi.org/10.1111/irel.12333 DOI: https://doi.org/10.1111/irel.12333
Doellgast, V., & Wagner, I. (2022). Collective regulation and the future of work in the digital economy: Insights from comparative employment relations. Journal of Industrial Relations. https://doi.org/10.1177/00221856221101165 DOI: https://doi.org/10.1177/00221856221101165
Efimov, I., Lengen, J. C., Kordsmeyer, A.-C., Harth, V., & Mache, S. (2022). Capturing and analysing the working conditions of employees with disabilities in German social firms using focus groups. BMC Public Health, 22(1), 413. https://doi.org/10.1186/s12889-022-12689-w DOI: https://doi.org/10.1186/s12889-022-12689-w
Fauzi, A. (2021). The Wage System (Ijarah) In Islam: A Comparative Perspective of the Scholars. Iqtishodia: Jurnal Ekonomi Syariah, 6(2), 31–35. DOI: https://doi.org/10.35897/iqtishodia.v6i2.210
Hakimi, A. R., Mukarramah, M., Sari, C. W., & Sari, R. P. N. (2024). Legal Policy for Women Workers in Indonesia: A Review of Contemporary Islamic Law. MILRev: Metro Islamic Law Review, 3(1), 66–94. DOI: https://doi.org/10.32332/milrev.v3i1.9023
Husain, S., Ayoub, N. P., & Hassmann, M. (2024). Legal pluralism in contemporary societies: Dynamics of interaction between islamic law and secular civil law. SYARIAT: Akhwal Syaksiyah, Jinayah, Siyasah and Muamalah, 1(1), 1–17. DOI: https://doi.org/10.35335/cfb3wk76
Ikhsan, M. M., Nuraeni, N., & Meiriyanti, D. (2024a). Integrating Islamic Business Ethics in Labor Protection and Minimum Wage Determination in Indonesia. Mu’amalah: Jurnal Hukum Ekonomi Syariah, 3(1), Article 1. https://doi.org/10.32332/muamalah.v3i1.8188
Ikhsan, M. M., Nuraeni, N., & Meiriyanti, D. (2024b). Integrating Islamic Business Ethics in Labor Protection and Minimum Wage Determination in Indonesia. Mu’amalah: Jurnal Hukum Ekonomi Syariah, 3(1), Article 1. https://doi.org/10.32332/muamalah.v3i1.8188 DOI: https://doi.org/10.32332/muamalah.v3i1.8188
Kunarti, S., Handayani, S. W., Ardhanariswari, R., & Faisal, F. (2024). Perspective of Employment Relations and Wages in Labor Law and Islamic Law. 8(1), 386–402. DOI: https://doi.org/10.22373/sjhk.v8i1.17045
Mohrenweiser, J., & Pfeifer, C. (2023). Wage Structures, Fairness Perceptions, and Job Satisfaction: Evidence from Linked Employer-Employee Data. Journal of Happiness Studies, 24(7), 2291–2308. https://doi.org/10.1007/s10902-023-00680-0 DOI: https://doi.org/10.1007/s10902-023-00680-0
Mustafa, D. G., & Rehman, D. Z. U. (2024a). Islamic Jurisprudence on Labor Laws: Principles, Practices, and Contemporary Applications. Al Manhal Research Journal, 4(3), Article 3. https://almanhal.org.pk/ojs3303/index.php/journal/article/view/183
Mustafa, D. G., & Rehman, D. Z. U. (2024b). Islamic Jurisprudence on Labor Laws: Principles, Practices, and Contemporary Applications. Al Manhal Research Journal, 4(3), Article 3. https://almanhal.org.pk/ojs3303/index.php/journal/article/view/183
Mustafa, G., & Rehman, Z. U. (2024). Islamic Jurisprudence on Labor Laws: Principles, Practices, and Contemporary Applications. Al Manhal Research Journal, 4(3). https://almanhal.org.pk/ojs3303/index.php/journal/article/view/183
Nugroho, A., Ronaboyd, I., Rusdiana, E., Prasetio, D. E., & Zulhuda, S. (2024). The impact of labor law reform on Indonesian workers: A comparative study after the Job Creation Law. 8(1), 65–106. DOI: https://doi.org/10.15294/lslr.v8i1.14064
Pyo, J., Lee, M., Ock, M., Park, G., Yang, D., Park, J., & Kim, Y. (2020). Bus Workers’ Experiences with and Perceptions of a Health Promotion Program: A Qualitative Study Using a Focus Group Discussion. International Journal of Environmental Research and Public Health, 17(6), Article 6. https://doi.org/10.3390/ijerph17061992 DOI: https://doi.org/10.3390/ijerph17061992
Scheelbeek, P. F. D., Hamza, Y. A., Schellenberg, J., & Hill, Z. (2020). Improving the use of focus group discussions in low income settings. BMC Medical Research Methodology, 20(1), 287. https://doi.org/10.1186/s12874-020-01168-8 DOI: https://doi.org/10.1186/s12874-020-01168-8
Silalahi, M. S., & Walsh, S. (2023). Analyzing Government Policies in Addressing Unemployment and Em-powering Workers: Implications for Economic Stability and Social Welfare. Law and Economics, 17(2), Article 2. https://doi.org/10.35335/laweco.v17i2.3 DOI: https://doi.org/10.35335/laweco.v17i2.3
Simms, M. (2024). Radical pluralism, high inflation, and trust in historical context: The continued relevance of Fox in understanding UK public sector strikes. Employee Relations: The International Journal, 46(6), 1306–1319. https://doi.org/10.1108/ER-08-2023-0412 DOI: https://doi.org/10.1108/ER-08-2023-0412
Tampubolon, L. R. R. U., Sayidah, N., & Amiq, B. (2023). The Role of Labor Unions in Determining Minimum Wage in Indonesia. International Journal of Professional Business Review: Int. J. Prof.Bus. Rev., 8(7), 73. DOI: https://doi.org/10.26668/businessreview/2023.v8i7.2625
Tortia, E. C. (2008). Worker well-being and perceived fairness: Survey-based findings from Italy. The Journal of Socio-Economics, 37(5), 2080–2094. https://doi.org/10.1016/j.socec.2007.10.005 DOI: https://doi.org/10.1016/j.socec.2007.10.005
Wulansari, A. D. (2021). Indonesia’s Cheap Wages Regime: The Political Economy of Minimum Wages Policy under Jokowi Presidency. Fudan Journal of the Humanities and Social Sciences, 14(3), 417–444. https://doi.org/10.1007/s40647-021-00324-8 DOI: https://doi.org/10.1007/s40647-021-00324-8
Yasmeen, K. (2024). Framework for Islamic social entrepreneurship. Journal of Islamic Accounting and Business Research, ahead-of-print(ahead-of-print). https://doi.org/10.1108/JIABR-08-2023-0256 DOI: https://doi.org/10.1108/JIABR-08-2023-0256
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2025 Fikri Al Ghifary

This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.