Javanese, Sundanese

Western Indonesian Time (UTC+07:00)

Undoubtedly, payroll is a critical process for any organization. The pay cycle refers to the period an organization pays its employees, which can vary depending on the pay frequency that the organization chooses to adopt.

Indonesia follows a monthly pay cycle.

There is no policy pertaining to the 13th salaries in Indonesia.

The minimum wage requirement varies based on the local government regulations ranging from 1,958,169 IDR in Central Java to 5,067,381 IDR  in DKI Jakarta.

The maximum overtime hours are 4 per day and 18 per week. Overtime worked during weekdays is paid 150.00% of the regular hourly wage for the first overtime hour, increasing to 200.00% for every subsequent overtime hour.

No law or regulation in Indonesia explicitly regulates the collection, use, or handling of an applicant’s personal data, including protecting the privacy of an employee’s particulars.

There is no special legislation for hiring.

Aside from reviewing the employment contract and the usual formalities surrounding onboarding, there is no specific legislation pertaining to the onboarding process.

In Indonesia, probationary periods are usually three months.

The following national holidays are recognized in Indonesia:

• Jan 1: New Year's Day
• Jan 22: Chinese New Year
• Feb 18: Ascension of the Prophet Day
• Mar 22: Holy Day of Silence
• Apr 7: Good Friday
• Apr 22 and Apr 23: Eid al-Fitr
• May 1: Labor Day
• May 18: Ascension of Jesus
• Jun 1: Pancasila Day
• Jun 4: Vesak Day
• Jun 29: Eid al-Adha
• Jul 19: Islamic New Year
• Aug 17: Independence Day
• Sept 29: Prophet's Birthday
• Dec 25: Christmas

When employees are sick or injured, they are entitled to paid sick leave, provided they show medical confirmation of their ill health. Employees can also have long-term sick leave lasting for longer than one year. A doctor should recommend such leave in writing.

Payment to employees on prolonged sick leave is as follows:

• 100% in the first four months
• 75% in the second four months
• 50% the third four months
• 25% of wages until termination

Employees are entitled to three months of fully paid maternity leave before the estimated due date and one and a half months of leave following the birth. The maternity leave is paid at 100% of the regular salary rate of pay.

New fathers are entitled to 2 days' leave for the birth of their child or a miscarriage.

Employees are entitled to up to 2 days of paid leave due to the death of their spouse, one day of paid leave for the death of their parents or parent-in-law, or the death of their children. If a member of the employee's household dies, they shall be entitled to 1 day of paid leave.

The reasons for which employees can be discharged from work are as follows:

• The employee violates the employment agreement
• The employee is imprisoned
• The employee has been ill for more than 12 months
• The employee is absent from work for more than five days without a valid reason, provided they have been notified twice
• The employee has reached retirement age

Not all employee dismissal reasons should be related to their misbehavior. The employer can discharge employees for several business-related reasons:

• There can be a change in the company's status, its merger with another business, or the acquisition of its ownership
• The employer becomes insolvent
• The employer has suffered continuous losses for two years consecutively, as proven by financial reports
• The employer is closing the business permanently

Notice periods within Indonesia are generally 30 days, although employers can specify longer notice periods within the employment contract.

Severance pay is mandatory if applicable and is determined by the employee's length of service.

• Less than 1 year – 1-month wage
• Between 1 and 2 years – 2 months' wage
• Between 2 and 3 years – 3 months' wage
• Between 3 and 4 years – 4 months' wage
• Between 4 and 5 years – 5 months' wage
• Between 5 and 6 years – 6 months' wage
• Between 6 and 7 years – 7 months' wage
• Between 7 and 8 years – 8 months' wage
• More than 8 years – 9 months' wage

There are two types of Visas for foreign nationals who intend to live and work in Indonesia.

Electronic ITAS (e-ITAS) - Employers need to apply for an ITAS on behalf of future employees. The ITAS grants employees the right to stay in Indonesia and open a bank account. They can also stay in the country and, after three years, apply for permanent residency.

Before applying for the ITAS, the employee must also get a Visa Izin Tinggal Terbatas (VITAS) – an Indonesian limited-stay permit visa.

The Kartu Izin Tinggal Tetap (KITAP) is a visa an employee can also apply for, which grants the employee a permanent residence permit (KITAP), but this is only available to people who have held an ITAS for three or more years.

• Criminal Records - Yes
• Medical History - If required for employment
• Drug Screening - If required for employment
• Credit Checks - If required for employment
• Social Media - No

Employers in Indonesia frequently carry out background checks on applicants. Indonesian employment laws do not expressly regulate background checks. Certain background checks are in practice subject to the consent of the applicant.