This Employment Agreement template is designed for use in Indonesia when hiring employees under Indonesian law. It incorporates requirements from key legislation including the Manpower Law (Law No. 13 of 2003), the Job Creation Law of 2020, and related implementing regulations. The document should be used when establishing new employment relationships or formalizing existing ones, ensuring compliance with mandatory provisions regarding working conditions, benefits, and termination procedures. It includes essential terms required by Indonesian law while allowing customization for specific roles and industries. The agreement can be adapted for various employment types, from permanent to fixed-term contracts, and includes provisions for both local and expatriate employees, though additional requirements may apply for foreign workers.
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1. Parties: Identification of the employer and employee, including full 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, responsibilities, and reporting relationships
5. Term of Employment: Duration of employment (permanent or fixed-term) and probation period if applicable
6. Working Hours and Location: Standard working hours, overtime provisions, and primary work location
7. Remuneration: Base salary, payment schedule, and method of payment
8. Benefits: Mandatory benefits including BPJS (social security and healthcare), leave entitlements, and other standard benefits
9. Confidentiality: Protection of company confidential information and trade secrets
10. Intellectual Property: Ownership of work products and innovations created during employment
11. Termination: Grounds for termination, notice periods, and severance requirements as per Indonesian law
12. Post-Employment Obligations: Return of company property and continuing obligations after employment ends
13. Governing Law: Confirmation of Indonesian law as governing law and dispute resolution procedures
14. General Provisions: Standard boilerplate clauses including amendments, entire agreement, and severability
1. Non-Competition: Restrictions on working for competitors, used for senior positions or roles with access to sensitive information
2. Non-Solicitation: Restrictions on soliciting employees or customers, typically for management or sales roles
3. Performance Review: Details of performance evaluation process and KPIs, used for performance-based roles
4. Commission Structure: Details of sales commissions or performance bonuses, included for sales or commission-based roles
5. Mobility Clause: Provisions for potential relocation or travel, used when job may require geographical flexibility
6. Training Obligations: Specific training requirements and bond terms, used when significant training investment is involved
7. Language Requirements: Dual language provisions and controlling language, used when employee is non-Indonesian
1. Schedule 1 - Job Description: Detailed description of role, responsibilities, and performance expectations
2. Schedule 2 - Compensation Package: Detailed breakdown of salary components, allowances, and benefits
3. Schedule 3 - Company Policies: Key company policies that form part of the employment terms
4. Schedule 4 - Confidential Information: Specific list of information considered confidential
5. Appendix A - Code of Conduct: Company's code of conduct and ethical standards
6. Appendix B - Leave Policy: Detailed leave entitlements and procedures
Authors
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