The Self Employment Form is essential for businesses operating in Indonesia that engage independent contractors rather than traditional employees. This document becomes necessary when companies need to formalize relationships with external service providers while ensuring compliance with Indonesian labor laws, particularly Law No. 13 of 2003 on Manpower and related tax regulations. It helps establish clear boundaries between employment and independent contractor status, protecting both parties' interests. The form includes crucial details about service scope, payment terms, tax responsibilities, and other obligations specific to Indonesian business practices. It's particularly relevant in today's growing gig economy and flexible working arrangements within Indonesia's business landscape.
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1. Parties: Identification of the Company/Client and the Self-Employed Contractor, including full legal names, addresses, and tax identification numbers
2. Background: Context of the agreement and confirmation of the contractor's independent status
3. Definitions: Key terms used throughout the agreement including 'Services', 'Deliverables', and 'Contract Period'
4. Scope of Services: Detailed description of the services to be provided by the contractor
5. Term and Termination: Duration of the agreement and conditions for termination by either party
6. Compensation and Payment Terms: Fee structure, payment schedule, and invoicing requirements
7. Independent Contractor Status: Clear statement of independent contractor relationship and distinction from employment
8. Contractor's Obligations: Key responsibilities including quality of work, timeline adherence, and professional conduct
9. Tax Responsibilities: Contractor's obligations regarding income tax and other applicable taxes under Indonesian law
10. Intellectual Property Rights: Ownership and rights to work products created during the engagement
11. Confidentiality: Protection of confidential information and trade secrets
12. Governing Law: Confirmation of Indonesian law as governing law and jurisdiction
1. Non-Compete Clause: Restrictions on working with competitors (use when contractor has access to sensitive information)
2. Equipment and Resources: Specifications about tools and resources when contractor needs to use client equipment
3. Insurance Requirements: Required when contractor needs specific insurance coverage for high-risk services
4. Performance Metrics: Include when specific performance standards need to be measured and maintained
5. Dispute Resolution: Detailed dispute resolution procedures when parties prefer specific resolution methods
6. Social Security Participation: Include when contractor opts to participate in BPJS programs
7. Subcontracting Rights: Include when contractor may need to subcontract certain tasks
1. Schedule A - Detailed Service Description: Comprehensive list of services and deliverables
2. Schedule B - Fee Schedule: Detailed breakdown of fees, rates, and payment milestones
3. Schedule C - Performance Standards: Specific metrics and quality standards for service delivery
4. Appendix 1 - Required Licenses: Copies of contractor's relevant licenses and certifications
5. Appendix 2 - Tax Registration: Contractor's tax registration details and compliance documents
6. Appendix 3 - Insurance Certificates: Copies of required insurance policies (if applicable)
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