Document background
A Separation Agreement and Release is a crucial document used when formally ending an employment relationship in Indonesia. This document is essential for both employers and employees to ensure compliance with Indonesian labor laws, particularly Law No. 13 of 2003 on Manpower and the Omnibus Law (Law No. 11 of 2020). The agreement is typically used when both parties have mutually agreed to end the employment relationship, or when a unilateral termination needs to be formalized. It outlines all statutory entitlements, including severance pay, service appreciation pay, and rights compensation, while providing legal protection through mutual releases. The document must be carefully drafted to ensure compliance with local regulations, including mandatory benefits calculations and procedural requirements. A well-drafted Separation Agreement and Release helps prevent future disputes by clearly documenting all terms of the separation and ensuring both parties understand their rights and obligations.
