Confederation of Indonesian Workers Union chairman Yoris Raweyai said the striking workers are calling on the government to increase the minimum wage, health insurance and social security for all employees and revise government policies that allow companies to hire temporary staff on one-year contracts without benefits.
"We warn the government that we can do worse to the country's economy if they continue ignoring our three main demands," said Said Iqbal, a protest organiser from the Indonesian Workers Assembly.
Indonesia's Constitutional Court ruled in January that the hiring practice was unconstitutional and violates workers' rights but so far little has been done to redress the balance.
Trade unionists have continually denounced agency work as exploitative and illegal, depriving workers of benefits such as pensions, social security and other basic rights.
"Outsourced workers get nothing," said United Federation of Indonesian Metalworkers shop steward Ridwan Pandjaitan.
"Too many companies don't want to take on permanent employees because they have to pay pensions and give workers other rights."
Over 200,000 workers marched in the industrial city of Bekasi, just outside Jakarta, waving flags and chanting "Workers united. Can never be defeated."
Many thousands of workers marched through Jakarta itself in the afternoon, and around 11,000 police and 4,000 military personnel were deployed around the rally.
Jakarta police said that hundreds of thousands of labourers from more than 700 companies in 80 industrial estates around the capital had taken to the streets.
Trade unions and other sources put the national figure as high as 2.8 million on strike in 34 cities.
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