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EOR Partners in Indonesia
Employ in Indonesia
Indonesia, as the largest economy in Southeast Asia, presents numerous opportunities for businesses looking to expand globally. With its diverse and growing consumer base, rich natural resources, and strategic geographic location, Indonesia is a key player in regional and global markets. The country is known for its vibrant startup culture and steady economic growth, making it an attractive destination for foreign investments.
About the Country of Indonesia
Indonesia is an archipelago of more than 17,000 islands, boasting the fourth-largest population in the world. Its economy is driven by industries such as manufacturing, agriculture, mining, and services, with significant contributions from the technology and digital sectors. As a member of key trade agreements in Southeast Asia and beyond, Indonesia provides companies with excellent access to regional markets and a growing middle class.
275.5 Million
Population
Rupiah
Currency
1.319 Trillion
Global Domestic Product
Why Choose Indonesia For Global Expansion?
Indonesia offers vast potential for businesses looking to expand in Southeast Asia due to its large population, growing middle class, and digital transformation initiatives. The Indonesian government has made efforts to simplify foreign investment procedures, and businesses can benefit from a relatively low-cost workforce. Moreover, the country’s strategic location allows easy access to major markets in Asia and Oceania, making it a regional hub for global trade.
Employment Landscape
The employment landscape in Indonesia is diverse, with a mix of formal and informal sectors. There is a growing pool of highly skilled workers, particularly in urban areas like Jakarta, Bali, and Surabaya. Indonesian labor laws provide employees with a wide range of protections, including minimum wage regulations, statutory benefits, and mandatory severance pay. The country’s focus on workforce development is helping to bridge skill gaps in areas such as IT and engineering.
Our Services in Indonesia
We provide comprehensive support for businesses expanding into Indonesia, including payroll management, employment contracts, and compliance with local labor regulations. Our team assists with work permits and visa sponsorships for expatriate employees and handles employee onboarding, termination processes, and benefits administration, ensuring seamless operations in compliance with Indonesian laws.
Employment Benefits in Indonesia
In Indonesia, employers are required to provide statutory benefits such as contributions to the national health insurance program (BPJS Kesehatan) and the employment insurance program (BPJS Ketenagakerjaan). Additionally, many companies offer private health insurance, meal allowances, transportation benefits, and performance bonuses to attract and retain top talent in the competitive labor market.
Annual Leave
Employees in Indonesia are entitled to a minimum of 12 days of paid annual leave after completing one year of continuous service. Employers are encouraged to offer additional days of leave as part of employee benefits packages, depending on company policies and collective agreements.
Sick Leave
Employees in Indonesia are entitled to paid sick leave. According to labor laws, an employee who is unable to work due to illness is entitled to 100% of their wages for the first four months of illness. After this period, the wage entitlement reduces to 75% for the next four months, 50% for the following four months, and 25% thereafter until the employment is terminated.
Additional Benefits
Additional benefits commonly provided by employers in Indonesia include meal and transportation allowances, flexible work arrangements, and career development programs. Some companies also offer housing allowances, especially for expatriates, and various incentives like performance-based bonuses to enhance employee motivation and retention.
Work Hours and Breaks
The standard workweek in Indonesia is 40 hours, typically distributed over five or six days. Employees are entitled to at least a 30-minute break after working for four hours. Overtime is permitted, but it must be compensated at a higher rate, typically 1.5 times the regular hourly wage for the first hour of overtime and 2 times the rate for subsequent hours.
Salary Tax Table
| Taxable Base | Tax Liability | Excess of Taxable Base | Tax Rate |
|---|---|---|---|
| 0 - 60,000,000 | 0 | 0 | 5% |
| 60,000,001 - 250,000,000 | 3,000,000 | Amount over 60,000,000 | 15% |
| 250,000,001 - 500,000,000 | 28,500,000 | Amount over 250,000,000 | 25% |
| 500,000,001 - 5,000,000,000 | 91,000,000 | Amount over 500,000,000 | 30% |
| 5,000,000,001 and above | 1,541,000,000 | Amount over 5,000,000,000 | 35% |
*All figures based on local currency
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