The Work Agreement Contract serves as the primary legal document establishing an employment relationship in Indonesia. It is required under Law No. 13 of 2003 on Manpower and must incorporate recent changes introduced by the Job Creation Law (Omnibus Law). This document is essential when hiring new employees or formalizing existing employment relationships, whether for fixed-term or permanent positions. The agreement must address mandatory provisions required by Indonesian labor law, including working conditions, compensation, social security benefits, and termination procedures. It provides legal protection for both employers and employees by clearly defining rights, obligations, and expectations within the employment relationship, while ensuring compliance with local labor regulations and statutory requirements.
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1. Parties: Identification of the employer and employee with complete legal names and addresses
2. Background: Brief context of the employment relationship and purpose of the agreement
3. Definitions: Key terms used throughout the agreement
4. Position and Duties: Job title, role description, and primary responsibilities
5. Term of Employment: Duration of employment (fixed-term or permanent) and effective date
6. Working Hours and Location: Standard working hours, work location, and overtime provisions
7. Compensation and Benefits: Salary, allowances, bonuses, and statutory benefits
8. Leave Entitlements: Annual leave, sick leave, religious holidays, and other authorized absences
9. Social Security and Insurance: Mandatory BPJS participation and any additional insurance coverage
10. Performance Review: Evaluation process and frequency
11. Termination: Grounds for termination and procedures following Indonesian labor law
12. Governing Law: Reference to Indonesian law and relevant regulations
13. Dispute Resolution: Process for resolving employment-related disputes
14. Entire Agreement: Statement that the contract represents the complete understanding between parties
15. Execution: Signature blocks and date of agreement
1. Probationary Period: Terms of initial probation period - only for permanent employment agreements
2. Confidentiality: Non-disclosure obligations - for positions with access to sensitive information
3. Intellectual Property: IP rights assignment - for creative or technical positions
4. Non-Competition: Post-employment competition restrictions - for senior positions
5. Mobility Clause: Requirements for travel or relocation - for positions requiring movement
6. Training Requirements: Mandatory training and development programs - for specialized roles
7. Commission Structure: Details of commission-based compensation - for sales positions
8. Remote Work Provisions: Terms for working from home or remote locations - for flexible working arrangements
9. Company Policies: Reference to specific company policies - when extensive internal regulations exist
1. Schedule 1 - Job Description: Detailed description of roles, responsibilities, and reporting relationships
2. Schedule 2 - Compensation Structure: Breakdown of salary components, allowances, and benefits
3. Schedule 3 - Performance Metrics: Specific KPIs and performance evaluation criteria
4. Schedule 4 - Company Policies: Key company policies and procedures referenced in the agreement
5. Schedule 5 - Required Certifications: List of mandatory professional certifications or qualifications
6. Appendix A - Code of Conduct: Company's code of conduct and ethical standards
7. Appendix B - Leave Policy: Detailed leave policies and procedures
8. Appendix C - Confidentiality Agreement: Detailed confidentiality terms and requirements if applicable
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