End Of Fixed Term Contract Letter Template for Indonesia

When your fixed-term employment contract (PKWT) reaches its scheduled end date in Indonesia, you need a formal End Of Fixed Term Contract Letter to properly conclude the employment relationship. This document serves as official notification and ensures compliance with Indonesian labor regulations, protecting both employer and employee rights during the contract termination process.

When do you need this document?

You need an End Of Fixed Term Contract Letter whenever a PKWT naturally expires according to its predetermined timeline. This includes situations where seasonal employment contracts conclude, project-based contracts reach completion, or temporary replacement contracts end when the original employee returns. The letter is also required when fixed-term contracts reach their maximum allowable duration under Indonesian law, preventing automatic conversion to permanent employment status. Additionally, you'll need this document to maintain proper employment records and demonstrate compliance with Ministry of Manpower reporting requirements.

Key legal considerations

The letter must contain specific mandatory elements including complete contract reference details, clear statement of natural contract expiration, and comprehensive final settlement calculations. You must address all outstanding payments including final salary, unused annual leave compensation, and any applicable severance benefits as calculated under the Job Creation Law amendments. The document should specify deadlines for company property return, including uniforms, equipment, and access cards. Include clear statements about post-employment obligations such as confidentiality agreements and non-compete clauses that may continue beyond contract termination. Ensure the letter provides contact information for any follow-up questions and maintains professional tone throughout to preserve positive employment relationships.

Legal requirements in Indonesia

Under Law No. 13 of 2003 on Manpower and its amendments through Law No. 11 of 2020 on Job Creation, employers must provide formal written notification of contract conclusion. Government Regulation No. 35 of 2021 specifies documentation requirements and establishes that fixed-term contracts automatically terminate on their specified end dates without requiring additional termination procedures. The letter must comply with Minister of Manpower Regulation No. 2 of 2015 regarding proper notice periods and documentation standards. Indonesian labor law requires that all final calculations follow prescribed formulas for severance pay, with specific provisions for contracts terminated due to natural expiration versus other circumstances. The document becomes part of mandatory employment records that must be maintained for audit purposes and potential labor dispute resolution. Failure to provide proper documentation can result in penalties and complicate future employment verification processes.