276.3 M
Indonesian Rupiah
Bahasa Indonesia
Cost of Living
(US 69.92)
Time (UTC)
UTC +7
Presidential Republic

Hire in Indonesia without an entity and fully compliant with local labor laws

Indonesia has a strong economy and  18,307 mostly uninhabited islands. English is the top international language and Indonesians are proud of their 90.4% national literacy rate. 

The land area is approximately 275% the size of Texas and it’s about 10,066 miles between Jakarta and New York City. 

Get to know Indonesia

Indonesia is an archipelago touched by the South China Sea and Pacific Ocean on the north and east sides respectively. The Indian Ocean wraps the southern and western sides of this beautiful country that’s home to over 300 different ethnic groups and languages. The tropical climate varies with location, season, and altitude. There are three different time zones in Indonesia but no daylight savings time. 

Indonesians are welcoming and friendly. Their culture values community; they prefer being“one of a group” than alone. Given the country’s stunning natural resources, surfing, diving, hiking, and camping are popular activities.

Indonesian employees have strong work ethics and are more motivated by positive relationships between managers and subordinates than performance bonuses. One of the world's largest economies, the country is home to six of Forbes Global 2000 largest companies. The World Bank classifies Indonesia as a low middle income economy with the following trade agreements and alliances:

  • APEC - Asia-Pacific Economic Cooperation
  • ASEAN - Association of Southeast Asian Nations
  • RCEP - Regional, comprehensive economic partnership
  • ADB - Asian Development Bank
  • Non - Aligned Movement
  • G20 - Developing Nations
  • G20 - Group of Twenty
  • G33 - Forum for developing countries
  • OIC - Organization of Islamic Cooperation
  • UN - United Nations
  • WTO - World Trade Organization

“Must know” if you’re hiring in Indonesia without an employer of record

Entity requirements
Mandatory hiring contracts & clauses
Different compliance risks for full time vs contractor employees
Mandatory probationary periods
Allowable working hours & overtime wage laws
Timecard and attendance records
Required employer payroll, labor insurance, and tax payments
Discrimination protection
Notices & termination regulations

Budgeting for Indonesian employees

Hiring remote Indonesian professionals is smart and economical, assuming you’re fully compliant with local tax, labor, and wage laws.
Employee Classification–Full-time vs Contractor
  • Indonesia’s basic labor, Law 13/2003, applies equally to all employees
  • Definite term employees = contractors  
  • Indefinite term employees = permanent. 
  • Equal statutory employment rights; no distinction between the different types of workers
Employment Contracts

Penalties for violating employment law includes fines (e.g., a percentage of the worker’s wages) and jail terms

Repeat offenders are publicly identified and government institutions and commercial banks are instructed to refuse them services and loans 

One of two types of required contracts

  • Permanent employment (no expiration date); written or verbal
  • Non-permanent employment (fixed expiration date); written

Mandatory content for all employment contracts

  • No implied terms
  • Employer name, address, type of business
  • Employee name, address, gender, age
  • Job description 
  • Work site
  • Wage and payment method 
  • Terms stating employer and employee rights and obligations 
  • Length of agreement
  • Employer and employee signatures
  • Date and place signed
Probation Period
  • Optional
  • Maximum three months
  • Must receive at least minimum wage during probation
Standard Working Hours & Overtime

40 hours per week, generally 8:00 am - 5:00 pm local time

  • Eight hours per day if working five days per week
  • Seven hours per day if working six day per week
  • One 30-minute break after four hours

Standard work week is Monday-Friday

Female employees under 18 and pregnant women with doctor’s orders cannot be employed between the hours of 11 p.m. and 7 a.m.Maximum overtime four hours/day and 18 hours/week

Overtime pay varies from 1.5x -4.0x regular rate based on

  • Five or six-day work week
  • Weekday vs weekend
  • Public holiday
  • Fixed or variable allowances included in salary
Payroll Frequency


Wages & Bonuses
  • Minimum monthly wage = $130 USD - $325 U.S. USD 
  • Average monthly wage = $560 USD - $630 USD
  • Mandatory 13th-month payment (a.k.a., Religious Allowance, THR) 
  • Salaries in Jakarta average 15% higher than national rates
  • Wage regulations and amounts vary by local province

Salaries by Role (USD equivalent median salaries)

  • Data Scientist: $28,332
  • Electrical Engineer: $21,385
  • Hardware Engineer: $19,559
  • IT Manager: $21,105
  • Mobile Developer: $73,457
  • Product Manager: $32,174
  • Project Manager: $25,128
  • QA Engineer: $15,347
  • Software Engineer: $24,374
  • System Administrator: $39,443
  • UX Designer: $47,580
  • Web Developer: $46,761
Payroll Taxes & Employer Contributions
  • 3.70% Old-Age Security/Provident Fund
  • 0.30% Death Security
  • 0.24%- 1.7%  Work Accident Security (varies with risk level)
  • 4.0%   Healthcare Security(contribution capped at $783.37 USD) 
  • 2.0%   Pension Security
  • Private Healthcare-Unisure (optional)


  • Old-Age Security (Provident Fund)
  • Pension Security
  • Health Care Security
  • Work Accident Security
  • Death Security

Paid Leave


  • Three months (1.5 months before & 1.5 after delivery)
  • 100% salary
  • Doctor recommendation required to extend


  • Maximum two days 
  • 100% salary


  • Marriage = 3 days
  • Worker’s child’s marriage = 2 days
  • Childbirth or miscarriage = 2 days
  • Religious rituals (i.e., circumcision, baptism = 2 days

Holidays: Indonesia celebrates 16 national (public) holidays and multiple observances a year. Some have fixed-dates set on the Gregorian calendar and others are based on the Lunar calendar and thus observed on different dates each year. Most of the holidays are religious holidays, including Good Friday and Christmas.


  • Accrued at rate of one PTO day per 23 days worked
  • 12 months of consecutive employment = 12 PTO days
  • 6 consecutive years = 2 months PTO  in the 7th and 8th years of service


  • Mandatory medical certificate
  • 0-4 months employment = 100% 
  • 5-8 months employment = 75% 
  • 9-12 months = 50% of pay
  • > one year = 25% until termination
  • Woman are allowed an additional two days/month


  • Bereavement (Immediate family = 2 days; Extended family living with worker = 1 day)
  • Jury Duty
  • Voting
Termination & Severance

Governed by Manpower Law

Termination is highly discouraged and sometimes prohibited 

  • No unilateral termination
  • 14 days written notice to employee (an union if applicable)
  • Notify local Manpower office if employee accepts
  • Employee can reject termination notice in writing

Disagreements settled via 

  • Industrial relationship dispute settlement procedure

And a few fun facts about Indonesia

  • Public disagreements are rare, Indonesians typically say “not yet” instead of "no" 
  • People usually have time for others
  • Eating standing up or walking along a street is inappropriate, even though there are many restaurants along the roads

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