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Workers Agreement Template for Indonesia

A comprehensive employment contract governed by Indonesian law, specifically compliant with Law No. 13 of 2003 on Manpower and related regulations. This agreement establishes the formal employment relationship between an employer and employee in Indonesia, detailing essential terms and conditions including position, duties, compensation, benefits, working hours, leave entitlements, and termination provisions. The document incorporates mandatory requirements under Indonesian labor law while allowing for customization based on specific employment circumstances and company policies.

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What is a Workers Agreement?

The Workers Agreement serves as the primary legal document governing employment relationships in Indonesia, subject to Law No. 13 of 2003 on Manpower and related regulations. This document is essential when formalizing any employment relationship in Indonesia, whether for permanent or fixed-term positions. It outlines the rights and obligations of both employer and employee, ensuring compliance with local labor laws while protecting both parties' interests. The agreement typically includes comprehensive details about employment terms, compensation, benefits, working conditions, and termination procedures, and can be customized to accommodate specific industry requirements or company policies while maintaining compliance with Indonesian labor regulations.

What sections should be included in a Workers Agreement?

1. Parties: Identification of the employer and employee, including their legal details and addresses

2. Background: 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 (permanent or fixed-term) and probation period if applicable

6. Working Hours and Location: Standard working hours, work location, and overtime provisions

7. Remuneration: Salary, allowances, and payment terms

8. Leave Entitlements: Annual leave, sick leave, religious holidays, and other permitted absences

9. Social Security and Benefits: BPJS coverage, health insurance, and other benefits

10. Confidentiality: Protection of company confidential information

11. Intellectual Property: Ownership of work products and innovations

12. Termination: Grounds and procedures for termination of employment

13. Governing Law: Application of Indonesian law and jurisdiction

14. Dispute Resolution: Process for resolving employment-related disputes

What sections are optional to include in a Workers Agreement?

1. Non-Competition: Restrictions on working with competitors, used for senior positions or roles with access to sensitive information

2. Mobility Clause: Terms regarding potential relocation or transfer, used when the position may require geographical mobility

3. Commission Structure: Details of commission-based compensation, used for sales or performance-based roles

4. Training Requirements: Mandatory training programs and associated commitments, used when specific qualifications are required

5. Remote Working Provisions: Terms for working from home or remote locations, used when allowing flexible working arrangements

6. Performance Metrics: Specific KPIs and evaluation criteria, used for performance-based positions

7. Sign-on and Retention Bonuses: Special bonus terms and conditions, used for key positions or competitive hiring situations

What schedules should be included in a Workers Agreement?

1. Schedule 1 - Job Description: Detailed description of roles, responsibilities, and reporting relationships

2. Schedule 2 - Compensation Details: Breakdown of salary components, allowances, and benefits

3. Schedule 3 - Company Policies: Reference to applicable company policies and procedures

4. Schedule 4 - Code of Conduct: Expected behavioral standards and ethical guidelines

5. Appendix A - Leave Policy: Detailed leave application and approval procedures

6. Appendix B - Performance Review Process: Performance evaluation criteria and review procedures

7. Appendix C - Confidential Information: List of specific information considered confidential

8. Appendix D - Required Certifications: List of mandatory professional certifications or qualifications

Authors

Alex Denne

Advisor @ GenieAI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents

Jurisdiction

Indonesia

Publisher

GenieAI

Document Type

Employment Contract

Cost

Free to use

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