Protecting Ride-Hailing Drivers Without Killing the Platform's Economy

A simulation by Muhammad Anwar (2026) based on IDEAS data estimated that cutting the commission to eight percent could raise drivers' net income by around Rp474,000 per month, from Rp1.51 million to Rp1.99 million, equivalent to an increase of up to 31 percent. However, the simulation relies on one important assumption: that daily order value remains unchanged.

To date there is no evidence that daily order value has actually stayed the same after the policy was implemented. The base fare for online transportation services has not been adjusted since the service-fee formula was set in 2022, while operational costs keep rising. If order value and base fare do not change, cutting the commission only shifts how income is divided, rather than increasing the total income available. In the early weeks of the policy's implementation, a number of Gojek and Grab drivers reported that their income was relatively unchanged.

In practice, the cut felt by drivers differs from the eight percent figure announced by the government. Lily Pujiati, Chair of the Indonesian Transportation Workers Union, calculated that the accumulated platform deductions still amount to 24 percent of the consumer's payment. From a fare of Rp34,000, the operator first deducts an application fee of Rp5,000 and insurance of Rp1,000, leaving Rp28,000, from which eight percent, or Rp2,240, is deducted, so the driver receives Rp25,760 (Jatim Times, 2026). This discrepancy arises because the two figures refer to different components. The eight-percent figure refers to the service commission, while the application fee and trip insurance are separate components that already existed in the fare structure. Deputy Chair of House Commission V Syaiful Huda urged the Ministry of Communication and Digital Affairs (Komdigi) and the Ministry of Transportation to promptly issue technical regulations so that the definitions are clear to all parties during the transition period (Bisnis.com, 2026).

The regulation changes how income is split between platforms and drivers. However, the amount of income drivers actually receive still depends on other factors, especially adjustments to the base fare and transaction value. This means that changing the commission alone is not enough to raise driver income. As long as the base fare is not also adjusted, the policy changes how income is divided more than it adds to the income drivers receive.

This issue cannot be seen from only one side. Consumers, platforms, and drivers all have limits that shape the room for policy to maneuver. Understanding all three together is key to seeing why solving the ride-hailing problem is never simple.

Consumers are sensitive to price increases. This means the room to pass protection costs directly onto consumers is relatively limited. Drivers, too, understand this dilemma. The 81-percent figure explains it. Drivers themselves understand this consequence. In the Indef and PPPI survey of 1,000 drivers, 61 percent agreed that the government should set a minimum fare and 61 percent believed the policy would increase their income. At the same time, 60 percent expected the policy to reduce the number of orders, 52 percent anticipated customer complaints, and 49 percent worried their income would actually fall. Meanwhile, 65 percent considered the minimum-fare scheme fairer for both operators and drivers (Indef & PPPI, 2026b). Indef and PPPI assess that these findings show drivers understand there is a trade-off. On one hand they want protection through a minimum fare, but on the other hand they also realize the policy could reduce demand and the number of orders.

Platforms also have limitations. Companies must balance competitive fares, incentive costs for drivers, technology investment, and demands to achieve profitability. Because of this, the room to keep cutting commissions is not entirely in the companies' hands. Fare competition, incentive costs, technology investment, and profitability demands mean the room for commission adjustment is not entirely up to the company. The scope of implementation makes this limit concrete. GoTo confirmed the eight-percent commission applies specifically to two-wheeled passenger transport services, or GoRide, and Grab applies the same provision to GrabBike (Kompas.com, 2026). Food delivery and courier services fall outside the initial scope, even though both account for a large share of drivers' daily order volume.

Unlike consumers and platforms, the greatest pressure is felt by drivers. Falling income and rising operational costs force many drivers to work longer hours to maintain their earnings. Average driver net income fell from around Rp2.9 million per month in 2023 to around Rp1.7 million in 2025, while daily operational costs rose from Rp53,000 to Rp58,000, equivalent to 46 percent of gross income (IDEAS, 2026). Drivers close that gap by extending the time they spend online waiting for orders. A national survey by the Institute for Demographic and Affluence Studies of 1,018 drivers in 67 regencies and cities in December 2025 found that 51 percent of respondents worked nine to 12 hours a day, while 55.5 percent worked seven days without a day off (IDEAS, 2026). These long working hours lead to risk. IDEAS found that 50.3 percent of drivers had experienced a work accident while being a platform partner, with 5.6 percent of them suffering serious injuries and severe vehicle damage (IDEAS, 2026).

These three limits are interlocked. Squeezed income lengthens working hours, longer hours raise accident rates, and accident costs erode income again. The scale is large. Ride-hailing has long functioned as a primary occupation, and a 2022 Ministry of Transportation survey recorded that 81.31 percent of drivers regard it as their main source of livelihood (Detik, 2022). The Central Statistics Agency (BPS) recorded 87.74 million informal workers in February 2026, equivalent to 59.42 percent of the 147.67 million working population (Badan Pusat Statistik, 2026).

From the explanation above, the picture becomes fairly clear. Consumers have a limit to their willingness to pay, platforms have a limit to their ability to bear costs, while drivers already face both economic and physical limits. As long as the source of protection relies only on fare adjustments, the burden will simply shift from one party to another. Because of this, financing for protection needs to be sought from mechanisms outside the fare relationship between consumers, platforms, and drivers.

Debate over driver protection often focuses on fares and commissions. Yet the basic cost of protection itself is actually not large.

BPJS Ketenagakerjaan (the Employment Social Security agency) provides a 50-percent premium discount for the Work Accident Insurance and Death Benefit programs, bringing the premium to Rp8,400 per month from April through December 2026 (BPJS Ketenagakerjaan, 2026). That amount is only about 0.5 percent of a driver's monthly net income, far smaller than the protection benefits provided. A driver named Wahidin suffered a broken arm while carrying a passenger, with treatment costs of Rp124 million, and BPJS Ketenagakerjaan covered the entire amount because he was a registered participant (CNN Indonesia, 2025).

Even so, only 351,097 drivers were registered as of October 2025 out of around 2.5 million drivers, equivalent to 12-percent enrollment (Kompas.com, 2025). On that small base, BPJS Ketenagakerjaan paid out Rp68.9 billion to 2,406 ride-hailing workers from 2024 through October 2025, consisting of Rp42.3 billion in work accident benefits for 1,614 people, Rp26.2 billion in death benefits for 635 people, and Rp421.5 million in scholarships for 155 people (Kompas.com, 2025).

Low enrollment shows that the problem does not lie solely in the size of the premium. Other obstacles appear to weigh more heavily on drivers' decisions to enroll.

The large benefits, low premium, and still-minimal enrollment show that the main problem likely does not lie in cost. The bigger obstacle appears to lie in the registration and payment mechanism. Under the Non-Wage-Earner Worker (BPU) scheme, drivers must register and pay premiums independently. For workers whose income changes every day, the obligation to pay a monthly premium regularly becomes its own challenge.

BPJS Ketenagakerjaan once proposed an auto-debit scheme from drivers' daily income, and that proposal has not been implemented because it requires system integration and agreement with the app companies (CNN Indonesia, 2025). Although payment via e-wallet is already available, BPJS premiums cannot yet be deducted automatically from drivers' daily income on the platform.

Fixing this mechanism would not raise fares, would not cut the operator's margin, and would not demand additional premiums from drivers. This means the problem is no longer the availability of a protection program, but rather how to ensure that millions of drivers are actually registered and protected.

Different countries have chosen different approaches to protecting platform workers. There is no single model that works for everyone, because policies are adapted to each country's regulations and industry structure. Some countries place most of the obligation on platforms, others rely on public insurance systems or mixed schemes. Two examples show how to finance protection without touching consumer fares.

One approach used in the United States is adjusting protection to match a driver's activity on the app. US regulators attach the insurance obligation to the platform and divide it according to the driver's work phase within the app. Uber covers a minimum of USD 50,000 in third-party liability insurance per person when a driver is online and waiting for an order, then raises it to a minimum of USD 1 million when the driver is en route to pick up or is carrying a passenger (Uber, 2026). The market fills the gap between these two phases through a rideshare insurance product, an extension of a personal policy that covers the waiting-for-order period (Quinn & Mercury Team, 2025).

What is interesting about this approach is not the size of the benefit, but how the protection is designed. Operators have granular data on drivers' daily status, from online, to waiting for an order, to carrying a passenger. Because premiums are adjusted to the risk level of each work phase, they end up cheaper than a flat policy, so protection costs can be reduced without reducing coverage. The implementation mechanism does not have to be identical, since it depends on each country's regulations and industry structure.

The first example focuses on protection design, while the second shows how product distribution can be made more efficient.

Another approach focuses on how insurance products are distributed. In March 2024, the Indramayu Regency Government together with Bank bjb provided microinsurance to around 150 drivers with a premium of Rp50,000 per person for 12 months of coverage, plus accident compensation of up to Rp50 million (InfoPublik, 2024). The program is still small in scale, but it shows that such a scheme can be run in practice at a wider scope. The feasibility of an affordable-premium product has been proven, and its distribution channel ran through local government and a regional bank without conventional agency costs.

Operators, driver communities, and cooperatives offer similar structures at a much larger scale. The next challenge is no longer the product itself, but how to expand distribution and integrate the payment mechanism into the platform. Protection costs can be reduced through more efficient product design as well as simpler distribution mechanisms. This way, driver protection can be expanded without directly burdening consumers and platforms.

Despite bringing important changes, the Perpres (presidential regulation) cannot resolve the entire employment issue for ride-hailing drivers. This is because employment relationship status is governed by law, not by a presidential regulation.

Article 1, point 15 of Constitution No. 13 of 2003 states that an employment relationship is determined by three elements: work, wages, and command. According to Gadjah Mada University legal researchers Nabiyla Risfa Izzati and Mas Muhammad Gibran Sesunan, the current position of ride-hailing drivers constitutes a form of misclassification — an employment relationship positioned as a partnership even though it has the characteristics of an employment relationship (Aisyfaa & Hafizhah, 2026).

This debate arises because platforms still retain a number of forms of control over drivers. IDEAS recorded that 46.5 percent of drivers had experienced account suspension and 9.4 percent had their partnership permanently terminated (IDEAS, 2026), although the suspension mechanism itself serves a dual function as both a quality-control instrument and a passenger-safety protection. A Fairwork report assessed that platform working conditions in Indonesia remain below decent-work standards (Fairwork, 2025), with the note that this assessment is a comparative index and that a number of platforms run partner-welfare programs outside the scope of that index.

Developments at the international level are also driving regulatory change. On June 12, 2026, the 114th International Labour Conference adopted Convention 193 on Decent Work in the Platform Economy, with 406 votes in favor, eight against, and 36 abstentions (International Labour Organization, 2026). This development shows that the push to strengthen protection for platform workers is also growing internationally.

The convention applies to all platform workers regardless of their employment status, requires states to guarantee safe and healthy working conditions, and affirms that worker classification must be based on the facts of how the employment relationship is actually carried out, through the principle of primacy of facts (WIEGO, 2026). The Indonesian Transportation Workers Union has urged the government to ratify it promptly.

Even so, a number of issues remain unresolved. As of June 20, 2026, the official text of Presidential Perpres 27/2026 had not been released. Anwar considers a delay of more than a month hard to view as reasonable for a regulation announced directly by the President, while Elly Rosita Silaban, President of the Confederation of All-Indonesia Workers' Unions, stated that her union had not received an official briefing since the regulation was enacted (Hukumonline, 2026a).

The number of ride-hailing drivers also still has no agreed official figure. The Indonesian Online Driver Association cites 4.2 million drivers, the Two-Wheel Action Coalition cites four million, while a Sakernas-data simulation by Next Policy estimates 2.41 million (Republika, 2026). Anwar considers that the lack of authoritative data makes it difficult for ministries to design interventions such as social assistance or wage-subsidy assistance (Republika, 2026).

Thus, Perpres 27/2026 is a first step, but it has not resolved all issues of platform worker protection. According to Anwar, Perpres 27/2026 only accommodates part of two of the ILO's decent-work principles, namely fair pay and fair (safe) working conditions. Other aspects, such as fair contracts, participatory work management, and worker representation, still require further regulation (Sedane, 2026).

Protecting drivers does not have to come at the expense of the platform economy's sustainability. The key is not placing the entire cost of protection on a single party. The following steps can be taken simultaneously so that driver protection does not depend on a single source of financing.

Update the base-fare formula. As long as the fare formula still refers to the 2022 provisions, cutting the commission only changes how income is divided, not the economic value being divided. Adjusting the base fare would increase transaction value so that additional income does not come entirely from reducing the platform's margin. Adjusting the base fare enlarges order value, and that increase is distributed to drivers without cutting the operator's margin further.

Complete the auto-debit for premiums from platform balances. A premium of Rp8,400 per month with 12-percent penetration shows an obstacle in the payment mechanism. Integrating premium deductions directly from drivers' income balance could increase enrollment without adding a burden on either consumers or platforms.

Design products following work phases. Premium size can be adjusted to the risk level of each work phase. Since platforms already have data on driver activity, such a scheme has the potential to reduce protection costs without reducing benefits.

Close the legislative gap. Complete protection through changes to the law. There are at least three aspects to consider. First, introduce a legal category that recognizes platform workers with certain basic rights, as implemented through the Gig Workers Act in Malaysia and worker status in the United Kingdom (Aisyfaa & Hafizhah, 2026).

Second, require platforms to contribute to social security so that enrollment no longer depends entirely on drivers' own initiative. Third, set a clearer limit on working hours. House Commission V has proposed a maximum limit of 12 hours per day (Tribunnews, 2026), while SPAI (the Indonesian Transportation Workers Union) demands a normative right of eight hours, since many drivers work 12 to 18 hours a day (Jatim Times, 2026).

In the end, driver protection is not simply a question of who bears the cost, but how that cost is shared fairly. When the entire burden is placed on one party alone, whether consumers, platforms, or drivers, the policy will struggle to survive in the long run. Conversely, a combination of instruments opens up the possibility of expanding protection without sacrificing the sustainability of the platform economy.

More and more Indonesian consumers are working without a fixed pay slip. Yet most financial products are still designed on the assumption that the consumer is a formal worker with fixed, easily verifiable income. In this context, Perpres 27/2026 offers a number of lessons for industry players.

Hold off on assuming higher purchasing power. The simulation of a 31-percent income increase has circulated widely, while field realization has yet to confirm it. The simulation of an income increase of up to 31 percent is indeed widely cited. However, realization on the ground has not shown the same increase. Because of this, industry players need to be cautious about assuming that driver purchasing power has already increased in the short term.

Protection is hard to sell as a consumer differentiator. The Indef & PPPI survey shows that only around 25 percent of consumers consider insurance when choosing an app. Because of this, partner-protection programs are likely more valuable as a way to build trust and meet regulator expectations than as a marketing tool to attract new consumers.

Distribution is key. The Indramayu program shows that distribution through local government and regional banks can reduce acquisition costs compared to conventional channels. For financial industry players, integrating billing with the platform could be one way to reach the driver segment more efficiently.

Perpres 27/2026 is a first step toward strengthening protection for platform workers. However, this regulation also shows that a single policy is not enough to resolve a complex issue. Fare adjustment, protection-product development, payment-mechanism integration, and legal-framework improvement need to move forward together so that the platform economy can keep growing without sacrificing the welfare of its drivers.