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Sub Contract Work Agreement for Indonesia

Sub Contract Work Agreement Template for Indonesia

A comprehensive legal agreement governed by Indonesian law that establishes a contractual relationship between a main contractor and a subcontractor for the delegation of specific work, services, or deliverables. The document outlines the scope of work, payment terms, performance standards, and compliance requirements in accordance with Indonesian Labor Law (Law No. 13 of 2003) and relevant regulations on subcontracting. It includes provisions for worker protection, safety standards, and dispute resolution mechanisms while ensuring compliance with local content requirements and industry-specific regulations.

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What is a Sub Contract Work Agreement?

The Sub Contract Work Agreement is a critical document used in Indonesian business operations when a main contractor needs to delegate specific portions of their contractual obligations to another party (subcontractor). This document is essential for projects requiring specialized expertise, additional workforce capacity, or specific technical capabilities not available within the main contractor's organization. It must comply with Indonesian regulations, particularly Law No. 13 of 2003 on Manpower and Minister of Manpower Regulation No. 19 of 2012 on outsourcing conditions. The agreement typically includes detailed specifications of work scope, performance standards, payment terms, and compliance requirements, while ensuring proper risk allocation between parties. It's particularly important in sectors such as construction, manufacturing, and industrial services where complex project structures are common.

What sections should be included in a Sub Contract Work Agreement?

1. Parties: Identification of the main contractor and subcontractor, including their legal names, registration numbers, and authorized representatives

2. Background: Context of the agreement, including reference to the main contract and the basis for subcontracting

3. Definitions: Definitions of key terms used throughout the agreement

4. Scope of Work: Detailed description of the work to be performed by the subcontractor

5. Duration and Timeline: Contract period, key milestones, and completion dates

6. Payment Terms: Pricing, payment schedule, invoicing requirements, and payment methods

7. Performance Standards: Quality requirements, standards, and specifications that must be met

8. Responsibilities and Obligations: Specific duties of both parties, including materials, equipment, and workforce provisions

9. Compliance Requirements: Obligation to comply with relevant laws, regulations, and main contract requirements

10. Health, Safety and Environment: HSE requirements and standards to be maintained

11. Reporting and Supervision: Requirements for progress reporting and supervision arrangements

12. Insurance and Indemnity: Insurance requirements and indemnification obligations

13. Confidentiality: Protection of confidential information and trade secrets

14. Termination: Grounds and procedures for contract termination

15. Dispute Resolution: Procedures for resolving disputes, including jurisdiction and governing law

16. General Provisions: Standard boilerplate clauses including notices, amendments, and severability

What sections are optional to include in a Sub Contract Work Agreement?

1. Intellectual Property Rights: Required when the subcontracted work involves creation or use of intellectual property

2. Bank Guarantees: Include when performance bonds or other financial guarantees are required

3. Force Majeure: Detailed force majeure provisions when needed beyond standard provisions

4. Anti-Bribery and Corruption: Required for contracts with international parties or when working with government entities

5. Environmental Protection: Detailed environmental requirements for environmentally sensitive work

6. Local Content Requirements: Required when there are specific local content obligations

7. Training and Knowledge Transfer: Include when the subcontractor must provide training or transfer knowledge

8. Warranty: Detailed warranty provisions when the work includes supply of goods or installation

What schedules should be included in a Sub Contract Work Agreement?

1. Schedule 1 - Scope of Work: Detailed technical specifications and scope of work

2. Schedule 2 - Bill of Quantities: Detailed breakdown of quantities and prices

3. Schedule 3 - Project Schedule: Detailed timeline and milestones

4. Schedule 4 - Payment Schedule: Detailed payment terms, milestones, and conditions

5. Schedule 5 - Key Personnel: List of key personnel and their qualifications

6. Schedule 6 - Equipment and Materials: List of equipment and materials to be provided by each party

7. Schedule 7 - HSE Requirements: Detailed health, safety, and environmental requirements

8. Schedule 8 - Forms and Templates: Standard forms for reports, notices, and certificates

9. Appendix A - Main Contract Excerpts: Relevant excerpts from the main contract that apply to the subcontractor

10. Appendix B - Insurance Requirements: Detailed insurance specifications and certificates

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents

Jurisdiction

Indonesia

Publisher

Genie AI

Document Type

Service Contract

Cost

Free to use

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