The Work Contract Termination Letter is a crucial document in Indonesian employment law, used when an employer needs to formally end an employment relationship. It must be drafted in accordance with Law No. 13 of 2003 on Manpower (as amended by Law No. 11 of 2020) and related regulations, ensuring proper documentation of the termination process. The letter serves multiple purposes: it officially communicates the termination decision, specifies the legal basis for termination, outlines the effective date, details all financial entitlements, and provides instructions for the transition period. This document is essential for legal compliance and risk management, protecting both employer and employee interests while ensuring adherence to Indonesian labor law requirements.
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1. Header and Date: Company letterhead, date, and reference number of the letter
2. Employee Information: Full name, employee ID, position, and department of the employee
3. Subject Line: Clear indication that this is a termination letter
4. Legal Basis: Reference to relevant provisions of Indonesian Labor Law and company regulations justifying the termination
5. Termination Details: Effective date of termination and specific reasons for termination
6. Notice Period: Information about the notice period being given or paid in lieu
7. Financial Entitlements: Breakdown of final payments including severance, service pay, and other compensation as per Indonesian law
8. Company Property: Instructions regarding the return of company property and handover of work
9. Final Settlements: Timeline and process for final settlements and documentation
10. Closing: Formal closing statement, signature block for authorized company representative
1. Non-Compete Clause: Include when the employee's contract contains non-compete provisions that continue after termination
2. Confidentiality Reminder: Include when the employee had access to sensitive information or trade secrets
3. Reference Offer: Include when the company is willing to provide employment references
4. Mutual Release: Include when both parties agree to release each other from future claims
5. Exit Interview: Include when the company wishes to conduct an exit interview
6. Benefits Continuation: Include when there are specific arrangements for continuation of certain benefits post-termination
1. Calculation of Final Payments: Detailed breakdown of severance pay, service pay, compensation, and other entitlements as per Indonesian labor law
2. Company Property Checklist: List of company assets to be returned
3. Handover Document List: List of documents, files, and ongoing projects to be handed over
4. Final Clearance Form: Form listing all departments that need to provide clearance before final settlement
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