The Labour Contract Agreement serves as the primary document governing the employment relationship between companies and individuals in Indonesia. It is essential for establishing clear, legally compliant employment terms in accordance with Law No. 13 of 2003 on Manpower and the Job Creation Law (Omnibus Law). This agreement should be used when hiring new employees or formalizing existing employment relationships, whether for permanent or fixed-term positions. The document incorporates mandatory provisions required by Indonesian labor law, including working conditions, compensation structures, social security benefits, and termination procedures. It provides legal protection for both employers and employees while ensuring compliance with local labor regulations, tax requirements, and social security obligations.
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1. Parties: Identification of the employer and employee, including their complete legal names, addresses, and positions
2. Background: Context of the employment relationship and purpose of the agreement
3. Definitions: Definitions of key terms used throughout the agreement
4. Position and Duties: Detailed description of the employee's role, responsibilities, and reporting structure
5. Term of Employment: Duration of employment, whether fixed-term or permanent, including start date and end date if applicable
6. Probation Period: Length and terms of the probationary period, if applicable under Indonesian law
7. Working Hours and Location: Standard working hours, work location, and potential requirements for overtime or travel
8. Compensation and Benefits: Base salary, allowances, bonuses, and other benefits including mandatory social security (BPJS)
9. Leave Entitlements: Annual leave, sick leave, religious holidays, and other permitted absences
10. Confidentiality: Protection of company confidential information and trade secrets
11. Intellectual Property: Ownership of work products and innovations created during employment
12. Non-Competition and Non-Solicitation: Restrictions on competitive activities during and after employment
13. Termination: Grounds and procedures for termination, notice periods, and severance requirements
14. Governing Law: Specification of Indonesian law as governing law and relevant jurisdictions
15. Dispute Resolution: Process for resolving employment-related disputes
16. Entire Agreement: Statement that the agreement represents the complete understanding between parties
1. Mobility Clause: Required when the position may involve relocation or regular travel between company locations
2. Performance Reviews: Include when implementing specific performance evaluation systems and linking to compensation
3. Training Requirements: Used when mandatory training or professional development is required for the role
4. Commission Structure: Required for sales positions or roles with variable compensation components
5. Work From Home Provisions: Include for positions allowing remote work arrangements
6. Foreign Worker Provisions: Required when employing expatriate workers, including visa and permit obligations
7. Shift Work Provisions: Include for positions involving shift work or irregular hours
8. Company Policies Incorporation: Used when referring to specific company policies that form part of the employment terms
1. Schedule A - Job Description: Detailed description of job responsibilities, requirements, and performance expectations
2. Schedule B - Compensation Details: Breakdown of salary components, allowances, and benefits
3. Schedule C - Company Policies: Key company policies that form part of the employment terms
4. Schedule D - Confidential Information: Specific details of what constitutes confidential information
5. Schedule E - Performance Metrics: Specific KPIs and performance evaluation criteria
6. Appendix 1 - Required Documents: List of documents required from employee (certificates, permits, etc.)
7. Appendix 2 - Benefits Summary: Detailed description of all employee benefits and eligibility criteria
Relevant legal definitions
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Relevant Industries
Manufacturing
Technology
Financial Services
Retail
Healthcare
Education
Construction
Mining
Agriculture
Hospitality
Professional Services
Telecommunications
Transportation
Energy
Consumer Goods
Relevant Teams
Human Resources
Legal
Finance
Operations
Marketing
Sales
Information Technology
Research and Development
Production
Quality Assurance
Customer Service
Administration
Supply Chain
Project Management
Business Development
Relevant Roles
Chief Executive Officer
Chief Financial Officer
Managing Director
General Manager
Department Head
Senior Manager
Manager
Supervisor
Officer
Executive
Administrator
Specialist
Coordinator
Analyst
Engineer
Technician
Sales Representative
Customer Service Representative
Administrative Assistant
Project Manager
Human Resources Manager
Operations Manager
Finance Manager
Marketing Manager
Production Worker
Research and Development Specialist
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