Continuing the trends from previous years, e-commerce and digital continues to be major drivers of hiring activity. This has been driving high demand for skilled technology and digital talent, particually for those able to showcase commercial ability and digital acumen. The top skills that are in demand include machine learning, big data and artificial intelligence. (Robert Walters 2020 salary guide)
More information about average salaries in Indonesia can be found on Robert Walters’ 2020 salary survey.
15-30% salary rises are expected for job movers in 2020. For those remaining in a role, 10% expect a 0-6% annual salary increment, 64% expect a 7-15% annual salary increment while 26% expect a 15%+ annual salary increment.
English Proficiency: Low Proficiency
Number of LinkedIn Users (2019): 14,039,000
Top Local Job Portals: Indeed, Jobindo.com, JobStreet.com
More information about job portals in Indonesia can be found here.
Top Recruitment Agencies: Michael Page Indonesia, Alliance Recruitment Agency, Robert Walters Indonesia
Maximum calculation base is IDR 12 million/month starting 1 January 2020.
The employer is also expected to pay the employee withholding tax. Links to the public housing savings and social security scheme.
Indonesia follows a progressive income tax model. Links to employee payroll tax and employee income tax.
The source for the severance payments tax can be found here.
Rp 1,742,000 to Rp 4,200,000 depending on the province.
Paid weekly, bi-weekly, or monthly depending on employment contract.
13th month salary a.k.a Tunjangan Hari Raya (THR) payment
THR is a yearly bonus given to employees at least one week before the start of the religious holiday observed by the employee (based on the employee’s religion), equivalent to one month’s salary (based on the period of employment).
Recognized religious holidays: Eid-il-Fitri for Muslims, Christmas for Catholics and Protestants, Nyepi for Hindus, Vesak for Buddhists, and Chinese New Year for Confucianism.
If the employee has been working for more than 12 months, they are entitled to 1 month’s salary. Otherwise, the THR is pro-rated according to months of service (service period/12) x 1 month’s salary.
For 5 days work week: 8 hours per day and 40 hours a week
For 6 days a week: 7 hours a day and 40 hours a week
These working hours rules do not apply to certain businesses and are usually regulated with a Ministerial decision.
Employees are not permitted to work more than 3 extra hours a day and 14 extra hours per week.
Employees who hold high-level positions and whose working time cannot be restricted by hours are not eligible to receive overtime pay.
The 15 public holidays can be found here.
Employees are entitled to a total of 12 days of annual paid leave.
Sick leave is not deducted from the number of annual leave.
The employee is entitled to 1.5 months of paid leave prior to the delivery, and another 1.5 months of paid leave after the delivery. The length of maternity leave can be extended if there is a medical recommendation.
Employees working in the private sector are entitled to 2 days of paid leave excluding their annual leave.
There is no notice of termination in Indonesian law. However, if a company wants to terminate its employees, it has to obtain approval from the Industrial Relations Court (IRC) by filing a lawsuit, or if they signed a Mutual Termination Agreement, then the Mutual Termination Agreement should be registered with the IRC.
The Labor Law prohibits an employer from dismissing an employee for the following reasons:
Does not require a notice period for employers.
Employees must give one month’s notice when they decide to leave employment.
Depending on the reasons for employment termination, employers need to pay standard severance, long service pay, compensation pay, and/or separation pay
Not mandatory. 3 month probationary periods are permitted for employees on indefinite contracts, but cannot impose probationary period on employees on a fixed-term contract.
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