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region in Indonesia has a different minimumwage.
According to the Regulation of the Governor of
DKI Jakarta Province No. 230 of 2015 onMinimum
Provincial Wage of 2016, the minimum wage for
2016 in Jakarta is IDR 3,100,000 per month.
e. Working Hours and Overtime Work
Article 77 et seq. of Act 13 of 2003 govern working
time. In accordance with these provisions, working
hours shall be seven hours a day and 40 hours a
week for six working days a week or eight hours
a day and 40 hours a week for five working days
a week. According to Article 78 of Act 13 of 2003,
employees are only allowed to work longer if they
agreed to do so and if the employee does not work
overtime for more than three hours a day and 14
hours a week. Furthermore, the employer has to
compensate the employee for overtime work by
paying overtime pay. Overtime working hours and
overtime pay is further governed by Decree No.
102/MEN/VI/2004, which sets out rules how to
count the overtime hours and how to measure the
overtime pay.
f. Leave
Employees in Indonesia have the right to demand
paid leave. In accordance with Article 79 paragraph
2 (c) of Act 13 of 2003, the annual period of leave
shall not be less than 12 working days if the
employee works for 12 months consecutively with
the respective employer. An employee in Indonesia
can demand further leave in order to comply with
its religious duties, such as the participation on the
Hajj pilgrimage to Mecca.
g. Insurance
Indonesia has a national social security system.This
systemfacilitatesahealthinsurance,BPJSKesehatan
and social insurance, BPJS Ketenagakerjaan. BPJS
Kesehatan is a compulsory health insurance for
all Indonesian citizen and expatriates who have
resided in Indonesia for at least 6 months. BPJS
Ketenagakerjaan is an institution to cover social
benefits for employees. These benefits are pension
benefit, old age benefit, death benefit and work
accident benefit. All employees in Indonesia must
be enrolled to BPJS Ketenagakerjaan.
h. Termination
The termination of employment is governed in
Chapter XII of Act 13 of 2003. The law expressly
states that all involved parties shall make all efforts
to prevent termination of employment. If the
termination of employment remains inevitable,
the employer must negotiate the termination with
the employee or, if the employee is a member of
a labor union, with the union. If the parties reach
an agreement, the written agreement must be
registered with the Industrial Relations Court. The
Court will issue a registration deed (Art. 7 Law 2 of
2004 concerning Industrial Relationship Dispute
Settlements). If after negotiation no agreement is
reached, but the employer still wants to terminate
the employment contract he has to go through an
additional conciliation or mediation procedure
under involvement of the local manpower office.
If the conciliation or mediation fails as well, the
employer can apply for termination with the
Industrial Relations Court. The termination is only
valid after affirmative decision by the Industrial
Relations Court.
According to Article 153 of Act 13 of 2003,
the employer is prohibited to terminate the
employment among others for the following
reasons:
• the employee is absent from work because the
employee is ill as attested by a written statement
from the doctor who treats the employee
provided that the employee is not absent from
work for a period of more than 12 months
consecutively;
• the employee is absent from work because he or
she is practicing what is required by his or her
religion;
• the employee is related by blood or through
marriage to another employee in the enterprise
unless so required in the collective work
agreement or the enterprise’s rules and
regulations;
• the employee establishes, becomes a member
of and/or an administrator or an official of a
labor union; the employee carries out labor
union activities outside working hours, or
during working hours with permission by the
employer, or according to that which has been
stipulated in the individual labor agreement,
or the enterprise’s rules and regulations, or the
collective work agreement; or
• the employee is of different understanding/
belief, religion, political orientation, ethnicity,
color, race, sex, physical condition or marital
status.
Article 158 of Act 13 of 2003 lists several reasons
why an employment can be terminated due to the
employee’s wrongdoing. These are, among others, if
the employee:
• has stolen or smuggled goods and/or money
that belong to the enterprise or obtained them
by means of deceits;
• has given false or falsified information that
causes the enterprise to incur losses;
• has attacked, battered, threatened, or
intimidated co-workers or the employer in the
working environment;
