Registered Employment Agreement Template for Indonesia

A Registered Employment Agreement is Indonesia's cornerstone employment document that establishes the legal framework between employers and employees under Law No. 13 of 2003 on Manpower. This comprehensive contract must be registered with the Ministry of Manpower to create a legally valid employment relationship and ensure compliance with Indonesian labor regulations.

When do you need this document?

You need a Registered Employment Agreement whenever establishing formal employment in Indonesia. This includes hiring new permanent or fixed-term employees, converting contract workers to permanent status, promoting employees to new positions with different terms, or updating existing employment arrangements due to regulatory changes. The document is also required when expanding operations in Indonesia, establishing local subsidiaries, or ensuring compliance during labor inspections. International companies entering the Indonesian market must use this agreement for all local hires to meet legal requirements.

Key legal considerations

Your agreement must include mandatory BPJS social security enrollment under Law No. 24 of 2011, specifying both health and employment insurance coverage. Working hour provisions must comply with the standard 40-hour work week, overtime calculations, and rest period requirements as outlined in Government Regulation No. 35 of 2021. Termination clauses must align with Indonesian severance pay calculations and proper notice periods. The contract should clearly define probationary periods, which cannot exceed three months for permanent employees. Include specific provisions for religious holidays, annual leave entitlements, and maternity/paternity benefits as mandated by law. Salary structures must meet regional minimum wage requirements and specify payment schedules, allowances, and bonus arrangements.

Legal requirements in Indonesia

Under Minister of Manpower Regulation No. 152 of 2016, all employment agreements must be registered with local Manpower offices within 7 days of signing. The document requires signatures from authorized company representatives, typically the director or legal representative, along with the employee and witnesses. For companies with labor unions, union representative signatures may be required. BPJS representatives must verify social security enrollment details during registration. The agreement must be written in Bahasa Indonesia, though bilingual versions are acceptable for international employees. Include company registration numbers (NPWP, SIUP) and employee identification details (KTP number). Specify the governing law as Indonesian Manpower Law and designate Indonesian courts for dispute resolution under Law No. 2 of 2004 on Industrial Relations Dispute Settlement.