As an employer, before hiring any employees in Jakarta, it is important to know about employment regulations, such as the minimum wage, benefits, insurances.
This article discusses the important points that you have to take into account prior to recruitment.
Recruitment in Jakarta
1. Minimum Wage
Under the latest DKI Jakarta regulation, the minimum wage of an employee is IDR 4,267,349, with effect from 2020. In 2019, the minimum wage was IDR 3,940,973.
For employers who are not in compliance with this new regulation will be sanctioned by the Indonesian authority with one to four years of imprisonment.
Standard benefits that almost all Indonesian employees enjoy are overtime pay, paid annual leave, and festive holiday leave.
- Overtime pay: the overtime pay calculation during weekdays is different from the calculation during the holidays. The holidays’ overtime fee is higher starting from the first five hours of overtime
- Paid annual leave: employees in Jakarta are qualified for 12-day paid annual leaves once they have been employed for at least 12 months consecutively in the company. The paid annual leaves are not allowed to be carried over to the following year
- Festive holiday leave: employees in Jakarta are eligible for festive holiday leaves ranging from religious holidays to national holidays, commemorative holidays to international holidays
Required insurances for full-time employees are basic healthcare (BPJS Kesehatan) and social security (BPJS Ketenagakerjaan) insurances. Both employees and employers need to make contributions to the BPJS Kesehatan and BPJS Ketenagakerjaan.
For work-related injury insurance (JKK) and non-work-related accidental death insurance (JMT) under the BPJS Ketenagakerjaan, employees do not have to make any contributions.
Employment Contract in Jakarta
As per the Indonesian Manpower Law, there are two types of employment contracts in Jakarta and all across Indonesia.
The employment contract serves as a mutual written agreement between an employee and an employer to understand their obligations and protect their rights.
1. Permanent Employment Contract
This type of contract is the one you will mostly encounter in Indonesia. It is applicable for employees who hold permanent positions in a company. The contract includes a 3-month probation period and an employee will only become a permanent employee by law after they have completed the probation period.
2. Temporary Employment Contract
This type of employment contract applies to temporary or seasonal workers. It only lasts for a few months to two years depending on the length of the project.
As for freelancers, the special type of work contract is known as PKWT. However, under this contract, freelancers can only work 21 days the most in a month.
Employee Background Check for Employment in Indonesia
In addition to the employment contract, employee background checks should also be part of the hiring process to ensure the success rate.
Why is employee background check so vital for your business? The reason lies in that some hire can end up fruitless due to misrepresentation or deception from the potential candidates.
Hence, an employee background check can save your business from recruiting any dangerous or unqualified individuals. It can also reduce your company’s liability and avoid unnecessary lawsuits.
These are the thing you need to check and verify while performing an employee background investigation:
- Criminal record
- Education, qualification, and certification
- Work and employment history
- Sexual offense record
- Alcohol and drug tests
- Credit and financial background
How Cekindo can Assist with Employment in Jakarta
Cekindo offers world-class business outsourcing services of employment in Jakarta, including recruitment outsourcing, payroll outsourcing, and background check. We can help you streamline your business operations, reduce costs, and save time.
As one of the most prominent Indonesian business partners and outsourcing providers to many global organisations, Cekindo understands what it takes to bring your business to a new height at the local and international level. We always do our best to match your company’s goals and our expert team has built a great reputation for delivering dedicated and outstanding services.
We create the best opportunities for your business employment in Jakarta. Reach us today by filling in the form below.