6.1. About Work Agreements

10 Oct 2014

All factory workers, including those working at the factory and offsite, should have a work agreement written in Bahasa Indonesian and signed by both the employer and the worker.

A work agreement must state the terms and conditions of employment, including:

  • enterprise’s name, address, and type of business;
  • worker’s name, sex, age, and home address;
  • occupation and type of work;
  • duty stations or workplace;
  • amount of wages and method of payment;
  • rights and obligations of the worker and the employer;
  • starting date and duration of the contract;
  • place and date of the work agreement; and
  • signatures of both parties.

The provisions in a work agreement must be at least as favorable to the worker as the labour law and regulations, the company regulations or the collective bargaining agreement.

Oral work agreements are permitted for permanent work, but the employer must prepare a letter of appointment for the workers that includes:

  • worker’s name and address;
  • starting date of work;
  • type of work; and
  • amount of wages.

MANPOWER ACT NO. 13 OF 2003, ARTS. 22, 54, 56-58, 60, 63-66 [UU KETENAGAKERJAAN NO. 13 TAHUN 2003, PASAL 22, 54, 56-58, 60, 63-66].

6.1.1 Company Regulations

Enterprises with ten or more workers must establish company regulations, which take effect after they are approved by:

  • Head of District Manpower Office at regency/city, for enterprises that are located in one regency/city;
  • Head of Provincial Manpower Office for enterprises that are located in more than one regency/city in one province;
  • Director General of Industrial Relations and Social Security of the Ministry of Manpower and Transmigration, for enterprises that are located in more than one province.

Company regulations should be formulated in consultation with worker representatives, and should specify the rights and obligations of the employer and the workers, working conditions, disciplinary provisions and rules of conduct, and the period of their validity.
Company regulations cannot conflict with or provide less protection than the prevailing laws and regulations.
Companies are not required to have internal regulations if there is already a Collective Bargaining Agreement in place.

MANPOWER ACT NO. 13 OF 2003, ARTS. 108-115 [UU KETENAGAKERJAAN NO. 13 TAHUN 2003, PASAL 108-115];

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