Remote Excellence Awards 2024 | Deadline closes 1 March 2024

Enter now
Remote’s guide to employing in

Indonesia
indonesia flag}

Make employment in Indonesia easy. Let us handle payroll, benefits, taxes, compliance, and even stock options for your team in Indonesia, all in one easy-to-use platform.

  • Capital City

    Jakarta

  • Currency

    Indonesian rupiah (Rp, IDR)

  • Languages

    Indonesian

  • Population size

    267,670,543

  • Remote-Owned Local Entity

Services available in this country:
Employer of Record ProductContractor Management

Facts & Stats

Indonesia Map Illustration
  • Capital City

    Jakarta

  • Currency

    Indonesian rupiah (Rp, IDR)

  • Languages

    Indonesian

  • Population size

    267,670,543

  • Ease of doing business

    Easy

  • Cost of living index

    37.44 (2021)

  • Payroll frequency

    Monthly

  • VAT - standard rate

    10%

  • GDP - real growth rate

    5.0 (2019)

Officially the Republic of Indonesia, Indonesia is a conglomerate of 17,000 islands, and is simultaneously the world’s 4th most populous nation and Southeast Asia’s most powerful economy, with a GDP valued at over $3.5 trillion.

Home to over 1,300 ethnic groups and 700 languages, Indonesia hosts one of the world’s most ethnically diverse population, its second-most biologically diverse, and a history of record economic growth over the past two decades.

Grow your team in Indonesia with Remote

Looking to employ workers in Indonesia? Companies hiring in Indonesia must either own a legal entity in the country or work with a global employment solutions provider, usually one that provides employer of record services.

Remote can employ your team in Indonesia on your behalf through our local legal entity in the country and handle payroll, benefits, taxes, and compliance for your Indonesia team. You can also pay contractors now in Indonesia with Remote.

Risks of misclassification

Indonesia, like many other countries, treats self-employed individuals or contractors and full-time employees differently. Misclassification of contractors in Indonesia may lead to fines and penalties for the offending company.

Employing in Indonesia

Indonesia’s Labour Law of 2003 is the principal labour regulation that defines provisions for employee protections and workers’ rights at the federal level which are applicable to Indonesia’s workforce of 4.2 million.

Employees in Indonesia enjoy protections against discrimination based on age, religion, gender expression, and race.

Common questions that could come up during the hiring process include the minimum wage, overtime rates, and guaranteed paid time off. Remote can help you offer a complete, competitive, and compliant benefits package to your employees in Indonesia.

Minimum Wage

The monthly minimum wage for DKI Jakarta is IDR 5,067,381.

Payroll Cycle

For customers of Remote, all employee payments will be made in equal monthly instalments on or before the last working day of each calendar month, payable in arrears.

Onboarding Time

We can help you get a new employee started in Indonesia fast. The minimum onboarding time we need is only 15 working days.

Our team ensures your employees are onboarded and paid as quickly as possible while keeping your business compliant with all local employment legislation. The minimum onboarding time begins after the employee submits all required information onto the Remote platform. The onboarding timeline is also dependent upon registration with local authorities.

For all non-nationals of the country of employment, the Right to Work assessment (if applicable) will add three extra days to the total time to onboard. There may be extra time required if we need to follow-up on the right to work assessment.

Please note, payroll cut-off dates can impact the actual first day of employment. Remote has a payroll cut-off date of the 10th of the month unless otherwise specified.

17 Public holidays

Jan
Monday, 1 January 20241New Year 2024
Feb
Thursday, 8 February 20242Isra Mi’raj (Ascension Day)
Saturday, 10 February 20243Chinese New Year 2575 Kongzili
Mar
Monday, 11 March 20244the Holy Day of Silence, Saka New Year 1946
Friday, 29 March 20245Good Friday
Sunday, 31 March 20246Easter Day
Apr
Wednesday, 10 April 20247Eid Al-Fitr 1445 Hijri
Thursday, 11 April 20248Eid Al-Fitr 1445 Hijri
May
Wednesday, 1 May 20249International Labour Day
Thursday, 9 May 202410Ascension of Jesus Christ
Thursday, 23 May 202411Vesak Day 2568 BE
Jun
Saturday, 1 June 202412Pancasila Day
Monday, 17 June 202413Eid al-Adha 1445 Hijri
Jul
Sunday, 7 July 202414Islamic New Year 1446 Hijri
Aug
Saturday, 17 August 202415Independence Day of the Republic of Indonesia
Sept
Monday, 16 September 202416Birthday of Prophet Muhammad
Dec
Wednesday, 25 December 202417Christmas Day

Competitive benefits package in Indonesia

At Remote, we’re obsessed with helping you craft the best possible employee experience for your team. We are leading the way in practising “fair equity,” which means making sure employees everywhere have access to both the required and supplemental benefits they need to thrive (and that will allow you to attract the best local talent).

Our benefits packages in Indonesia are tailored to fulfil the local needs of your employees. Typically, our packages contain some or all of the following benefits:

  • Health Insurance

  • Dental Insurance

  • Vision Insurance

  • Mental Health Support

  • Pension or 401(K)

  • Life and Disability Insurance

Taxes in Indonesia

Learn how employment taxes and statutory fees affect your payroll and your employees’ paychecks in Indonesia.

  • 0.24% - 1.74%

    Work accident insurance

  • 3.7%

    Old Age

  • 0.3%

    Death benefit contribution

  • 2%

    Pension contribution

  • 4%

    Health insurance

Types of leave

Employees who have worked for an employer for at least 12 months consecutively are entitled to 12 days of paid annual leave. Employers are obligated to respect any provisions pertaining to leave entitlement stipulated in an employee’s contract or negotiated under a collective bargaining agreement.

Employment termination

Termination process

Indonesian labour law is unique in that it places the onus on employers to go the extra mile to avoid terminating an employee by negotiating to offer better working conditions, coaching, etc.

That aside, employee contracts can be terminated if a just cause is established, such as dishonesty, negligence, fraud, work-related offences, sustained illness over the course of 12 months, or business contingencies like redundancy or insolvency.

Notice period

There is no notice stipulated notice period but employers are generally expected to provide 30-days advance notice before terminating an employee.

Severance pay

Employees are entitled to severance pay that’s proportional to their tenure with an employer as defined below:

  • 1 months wages: Up to 1 year of employment

  • 2 months wages: Up to 1 year, but less than 2 years of employment

  • 3 months wages: Up to 2 years, but less than 3 years of employment

  • 4 months wages: Up to 3 years, but less than 4 years of employment

  • 5 months wages: Up to 4 years, but less than 5 years of employment

  • 6 months wages: Up to 5 years, but less than 6 years of employment

  • 7 months wages: Up to 6 years, but less than 7 years of employment

  • 8 months wages: Up to 7 years, but less than 8 years of employment

  • 9 months wages: 8 or more years of employment

Probation periods

Probationary periods can only be set for employees on indefinite-term contracts and cannot exceed three months.

Fair Pricing in Indonesia

Employer of Record

Hire and pay your global team

Starting at US$599/month

Top features

  • Satisfaction guaranteed

  • No deposits or hidden fees

  • Zero onboarding or offboarding fees

  • Compliant equity incentives support including withholding and reporting

  • Built-in security and compliance

  • Fast onboarding (average 2-3 days)

  • Flexible, localised benefits

Contractor Management

Compliantly onboard and pay contractors

US$29

per contractor/month

Start free trial

Top features

  • Only pay for contractors you actively work with

  • Work with contractors in 180+ countries

  • Create, edit, and sign tailored, compliant contracts

  • Approve contractor invoices with one click or auto-pay

  • Transparent payments with complete visibility

Global Payroll

Consolidate your multi-country payroll

US$50

per employee/month

Top features

  • Reduce costs by centralising payroll management

  • Ensure local compliance for every country

  • Direct support from in-house local payroll experts

  • Accurate, on-time, compliant payroll to level-up your employee experience

  • Tax and labour authority reporting handled for you

HRIS

Manage all of your employees in one place

Free
Sign up

Top features

  • Guided onboarding and offboarding

  • Employee profile and document management

  • Time and attendance (time off and tracking)

  • Expense management and reimbursement

  • Employee self-serve on the platform and mobile app