The facts in Bekasi Regency of Indonesia show that dynamic and harmonious industrial relations have not been achieved due to the large number of strikes. Based on data from the Bekasi Regency Police, in the last three years (2017-2019) there were 37 worker demonstrations. The number of layoffs, strikes, and industrial relations disputes submitted to the Industrial Relations Court and State Administrative Court shows that dynamic and harmonious industrial relations have not been achieved. This study aims to design an institutional model of local government industrial relations based on a three-tiered institutional frameworks referring to the model of New Institutionalism in Economic Sociology (NIES) by using the Soft Systems Methodology (SSM) methodology. The results showed the institutional model of local government industrial relations was built by three levels of institutional: 1) macro level is a policy to strengthen coordination and collaboration between local governments, trade unions and employers’ associations in industrial relations affairs, on the other hand, is a policy to increase the organizational capability of local governments in industrial relations; 2) meso level is strengthening local government governance in industrial relations services and industrial relations databases; and 3) the micro level is the improvement of understanding and improvement of social relations in industrial relations between workers, employers and local governments.