Employment Assignments
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Employment Assignments
Work Permits

Indonesian law requires any employer intending to employ foreign nationals to obtain approval of the Foreign Manpower Utilization Plan (Rencana Penggunaan Tenaga Kerja Asing (RPTKA)) from the MOE.

Employers who fail to obtain an RPTKA for employing a foreign national are subject to fine as follows:

Period since foreign worker enters Indonesia

Fine (per person per month)

1 month

Rp. 6,000,000

2 months

Rp. 12,000,000

3 months

Rp. 18,000,000

4 months

Rp. 24,000,000

5 months

Rp. 30,000,000

6 months

Rp. 36,000,000

 

The deadline for payment of the fine is two weeks after receiving the order to pay. If the relevant employer fails to pay by the deadline, the an additional penalty of 2% of the amount of the fine (per month, up to six months) will be imposed. In addition, applications for RPTKA approval will be temporarily suspended.

Under Regulation 34, Indonesian entities no longer have to obtain a Notification.

Applications for the approval of an RPTKA are submitted online (through the MOE’s online application website).

Exemptions from the Austrian Act on the Employment of Foreign Nationals

The MOE should issue an approval of the RPTKA once all required documents are complete (and the DKP-TKA has been paid).

The RPTKA approval can then be used as the basis to obtain the relevant visa to enter Indonesia for the purpose of working (VITAS) and the limited stay permit (ITAS). The VITAS and ITAS are required if the foreign national intends to reside and work in Indonesia.

Intra-company Transfer

Indonesian law does not differentiate between:

  • a foreign national who is an employee of a foreign entity and assigned to work at the Indonesian affiliate of that foreign entity as part of an intra-company transfer
  • a foreign national who is directly hired by an Indonesian entity
Entry Based on International Agreements

The Association of South East Asian Nations (ASEAN) has a number of mutual recognition agreements that open certain work fields to professionals (i.e., medical practitioners, dental practitioners, engineering services, nursing, tourism professionals, accountancy and architectural services). However, Indonesia has not yet ratified these mutual recognition agreements. As such, they are not yet effective in Indonesia.

Limited Stay Visa

The Limited Stay Visa can be granted to: a foreign national clergy, expert, worker, researcher, student, investor or elderly individual, as well as to their families, a foreign national who is legally married to an Indonesian individual and a foreign national traveling to Indonesian to stay for a limited period of time or to work on board a ship, floating device or other vessel operating within the Indonesian seas, territorial seas, continental shelf or the Indonesian Economic Exclusive Zone.

Payment of the Compensation Fund for Foreign Worker Utilization (DKP-TKA)

The DKP-TKA is set at USD 100 per month for each foreign national employed. If the RPTKA is valid for 12 months, the amount is increased to USD 1,200.

Once the DKP-TKA is paid, evidence of the payment must be submitted through the online application process on the MOE’s website.

Qualification for Foreign Workers

Foreign nationals intending to be employed by Indonesian employers must:

  • have an educational background appropriate for their job
  • have a competency certificate or prove that they have at least five years of relevant work experience
  • sign a statement letter confirming that they will help train an Indonesian counterpart worker in the same area of experience, (which needs to be proven through a report discussing the implementation of their imparted education and training)
  • have an Indonesian Taxpayer Identification Card (if they have been working for six months)
  • provide evidence that they have an insurance policy with an Indonesian insurance company
  • participate in the national social security program (if they have been working for six months)
Appointment of Indonesian Counterpart Workers

Indonesian law requires employers to appoint an Indonesian counterpart (Counterpart) for every foreign national employed. An exception exists when the foreign national is a director (i.e., a member of the board of directors) or commissioner (i.e., a member of the board of commissioners).

The law does not specify who qualifies to become a Counterpart. However, the focus of “counterparting” is the transfer of technology and expertise from the foreign national to the Counterpart. As such, the Counterpart is expected to be able to replace the foreign national at a later time.

The current policy of the MOE regarding appointing Counterparts is that the employer must consider the education, expertise and qualifications of both the Counterpart and the foreign national. Ideally, a Counterpart should be a subordinate of the foreign national.

An employer that violates the Counterpart requirement may be subject to a criminal sanction of detention for a minimum of one month and a maximum of 12 months, incur a fine of between IDR 10 million and a maximum of IDR 100 million, or both.

Ratio

The number of foreign nationals an entity in Indonesia can employ depends on a variety of factors (e.g., industry, size of the Indonesian entity, number of Indonesian employees).

The MOE may impose the following ratio requirements based on its own discretion:

  • a ratio of one foreign employee to 10 Indonesian employees
  • for a director-level role, the Indonesian company needed five Indonesian employees for every foreign employee 

If an Indonesian employer seeks to employ a large number of foreign nationals, the MOE expects the employer to employ a greater proportion of Indonesians. Additionally, the MOE may require the employer to explain why it needs to employ such a large number of foreign nationals.

Temporary Work Permit

Under Regulation 34, a temporary work permit (TWP) is required for the following activities:

  • making a commercial movie that has received authorization from the relevant agency
  • conducting audits, production quality control or inspections of Indonesian branches for more than one month
  • work related to machinery installation, electrical equipment, after-sales service or products that are in the business exploration stage
  • entertainment business services
  • a one-time job or work for less than 6 months

A TWP must be sponsored by an Indonesian entity. A TWP holder must also obtain a VITAS.

18 Positions that Cannot be Held by Foreign Nationals

The Minister of Employment issued Decree No. 349 of 2019 on Certain Positions That Are Restricted for Foreign Workers (Decree 349). Decree 349 lists 18 positions that cannot be held by foreign nationals (see prohibited positions below). Please note that all 18 positions are related to human resources. This stems from Article 46(1) of the Law No. 13 of 2003 on Labor, which prohibits foreign nationals from holding a position related to “managing personnel and/or certain positions.”

The List is as follows:

Name of Position

Indonesian

ISCO Code

English

Direktur Personalia

1210

Personnel Director

Manajer Hubungan Industrial

1232

Industrial Relations Manager

Manajer Personalia

1232

Human Resources Manager

Supervisor Pengembangan Personalia

1232

Personnel Development Supervisor

Supervisor Perekrutan Personalia

1232

Personnel Recruitment Supervisor

Supervisor Penempatan Personalia

1232

Personnel Placement Supervisor

Supervisor Pembinaan Karir Pegawai

1232

Employee Career Development Supervisor

Penata Usaha Personalia

4190

Personnel Declaration Administrator

Ahli Pengembangan Personalia dan Karir

2412

Personnel and Career Specialist

Spesialis Personalia

2412

Personnel Specialist

Penasehat Karir

2412

Career Advisor

Penasehat Tenaga Kerja

2412

Job Advisor

Pembimbing dan Konseling Jabatan

2412

Job Advisor and Counseling

Perantara Tenaga Kerja

2412

Employee Mediator

Pengadministrasi Pelatihan Pegawai

4190

Job Training Administrator

Pewawancara Pegawai

2412

Job Interviewer

Analis Jabatan

2412

Job Analyst

Penyelenggara Keselamatan Kerja Pegawai

2412

Occupational Safety Specialist

Positions Open for Foreign Nationals in Certain Sectors

On 27 August 2019, the Minister of Employment issued Regulation No. 228 of 2019 on Certain Titles Open for Foreign Workers (Decree 228). Decree 228 replaces the 19 decrees of the Minister of Employment regarding which titles foreign nationals can hold across various industries in Indonesia.

Other than including an attachment on titles or positions that are open for foreign nationals working in Indonesia, the following points in Decree 228 are important to note:

  • Foreign nationals can hold jobs as directors and commissioners as long as they are not managing personnel and the appointment of the foreign directors and commissioners does not contradict the prevailing laws and regulations. In other words, generally foreigners can still hold positions of directors or commissioners of an Indonesian company.
  • The Minister of Employment (or a specifically designated official of the MOE) has the discretion to approve work permits for foreign nationals intending to hold titles or positions that are not listed in the attachment of Decree 228. Previously, the Minister of Employment could still approve work permit applications for a foreign nationals if the proposed title or position was not specifically mentioned as open for foreign nationals. However, the approval required a recommendation from the relevant technical ministry which is no longer included in Decree 228.
  • Every two years, or whenever necessary, titles or positions open to foreign nationals, as well as their requirements, will be evaluated. However, Decree 228 does not specify what triggers a necessary evaluation outside of the regular schedule.
  • Work permits issued before 27 August 2019 (i.e., the date Decree 228 became effective) will remain valid until their expiry.

The attachment of Decree 228 includes a number of lists of titles and positions open for foreign nationals in Indonesia. Each title and position has a corresponding International Standard Classification of Occupations (ISCO)/ Indonesian Standard Classification of Occupation (KBJI) code.

The lists of open titles and positions are based on 18 business and industry categories in Indonesia. Some categories, groups and subgroups include more than 100 titles and positions that are open for foreign nationals (e.g., construction, education, information and telecommunication and mining and excavation) while some categories only specify a few titles and positions that are open for foreign nationals (e.g., real estate, human health and social activities and other services activities).

The 18 business and industry categories specifically mentioned in the attachment of Decree 228 are:

The List is as follows:

Category

Construction

Real Estate

Education

Processing Industry

Water Management, Water Waste Management, Waste Management and Recycling, and Remediation Activities

Transportation and Warehousing

Art, Entertainment, and Recreation

Provision of Accommodation and Provision of Food and Beverages

Farming, Forestry and Fishery

Activities of Rental and Leasing without Option, Manpower, Travel Agent, and Other Business Support

Finance and Insurance Activities

Human Health Activities and Social Activities

Information and Telecommunication

Mining and Excavation

Procurement of Electricity, Gas, Steam/Hot Water, and Cool Air

Wholesale and Retail Trade, Repair and Maintenance of Cars and Motorcycles

Other Services Activities

Professional, Scientific, and Technical Activities

Working and Vacationing in Indonesia for Australians

Applications for Limited Stay Visas from Australian citizens should be made in Australia and, if granted, are valid for 12 months. The visa allows the visa holder to work, with or without pay (volunteer work) in the education, tourism, health, social, sport and cultural sectors. However, the work should not be ongoing because that would require a longer time commitment.

There is an annual quota for special limited stay visas. Each year, between 1 July and 30 June, a maximum of 100 special limited stay visas are issued. The visas are also subject to strict conditions, including:

  • The foreign national’s main purpose is to visit Indonesia during another season. The applicant is between the ages of 18 and 30.
  • The applicant must at least have a degree-level qualification or have completed two years of higher education.
  • The applicant holds a recommendation certificate from the Department of Immigration and Citizenship in Australia.
  • The applicant is has basic mastery of Indonesian.
  • The applicant has a return plane ticket and a minimum of AUD 5,000 in a bank.
  • The applicant has not previously been a participant in the working holiday scheme.

The above conditions must be proven alongside the visa application.

There are certain fees associated with applying for the visa although the regulation does not specify the exact amount.

Post-Entry Procedures - ITAS and Re-Entry Permit

Once the foreign national arrives at an Indonesian airport (using the VITAS), the immigration officer in charge at the airport will take the foreign national’s fingerprints and photo as well as place a Re-entry permit sticker in the foreign worker’s passport indicating the date of arrival and the validity period of the re-entry permit.

The DGI’s system then sends the foreign national’s ITAS to the email address of the authorized representative of the Indonesian sponsoring company registered at the DGI’s system by email within three to ten business days after the foreign national’s arrival to Indonesia. The ITAS sent by the DGI must be printed out to be kept by the foreign national.

If an error occurs in the DGI’s system where the system could not find the foreign national’s information, the foreign national will need to go to their a Local Immigration Office to get their ITAS application processed. The immigration authorities at the airport will inform the foreign national about the error and affix an entry permit indicating that the foreign national still needs to apply for their ITAS at a Local Immigration Office within 30 days of the date of entry into Indonesia.

If the situation discussed above occurs, the foreign national must come present themselves to the Local Immigration Office to have their fingerprints and photo taken. The Immigration Office also requires an original passport for the process (i.e., the Immigration Office will hold the foreign national’s original passport until they issue the ITAS).

If a foreign national has both an ITAS and re-entry permit, they have legally complied with Indonesian immigration law and regulations. However, as an ITAS holder, the foreign must also obtain the following additional certificates or permits:

  • a Police Report Certificate (STM) issued by the Local Police Office where the foreign worker is domiciled (in Indonesia)
  • a Temporary Residential Card (SKTT) issued by the Local Population and Civil Registry Office where the foreign worker is domiciled (in Indonesia)
  • a report regarding the existence and arrival of the foreign national, issued by the local office of the MOE where the foreign worker is domiciled

Each accompanying dependent family member of the foreign worker must also obtain their own KITAS, STM and SKTT.

Entry Based on International Agreements - APEC Card

A foreign national who holds an APEC Card can come to Indonesia for business. Having an APEC Card means that the holder does not need to apply for a visa when they enter Indonesia. However, having an APEC Card does not mean that the foreign national does not need to obtain either a TWP or an RPTKA and relevant visa (if needed). If a foreign national is:

  • conducting any of the activities requiring a TWP, they must obtain a TWP and the relevant visa (i.e., there is no exemption to obtain a TWP (if required) if a foreign national has an APEC Card)
  • working in Indonesia, they will need to obtain an RPTKA (and other expatriate documents) ( i.e., there is no exemption to obtain an RPTKA (if required) if a foreign national has an APEC Card)