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Fixed Term Employment Contract Template for Indonesia

A Fixed Term Employment Contract governed by Indonesian law, specifically compliant with Law No. 13 of 2003 on Manpower (as amended by Law No. 11 of 2020) and related regulations. This contract establishes a defined-period employment relationship between an employer and employee, detailing terms and conditions including position, duties, compensation, benefits, working hours, and termination provisions. The document incorporates mandatory requirements under Indonesian labor law, including statutory benefits and social security provisions, while ensuring compliance with maximum duration restrictions for fixed-term employment.

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What is a Fixed Term Employment Contract?

This Fixed Term Employment Contract template is designed for use in Indonesia when establishing temporary or project-based employment relationships. It complies with Indonesian labor law requirements, particularly Law No. 13 of 2003 on Manpower (as amended by the Job Creation Law) and Government Regulation No. 35 of 2021. The document should be used when hiring employees for a specified period or specific project, subject to the maximum duration restrictions under Indonesian law. It includes essential provisions required by local regulations, such as working conditions, mandatory benefits, and social security arrangements, while also addressing standard employment terms like confidentiality and intellectual property rights. This template is particularly relevant for temporary positions, project-based work, or seasonal employment, but cannot be used for permanent core business activities as restricted by Indonesian law.

What sections should be included in a Fixed Term Employment Contract?

1. Parties: Identification of the employer company and the employee, including their complete legal names and addresses

2. Background: Brief context of the employment relationship and basis for the fixed-term nature of the contract

3. Definitions: Key terms used throughout the agreement

4. Position and Duties: Employee's job title, role, responsibilities, and reporting structure

5. Term of Employment: Duration of the fixed-term contract, including start and end dates, in compliance with Indonesian law maximum periods

6. Working Hours and Location: Standard working hours, work location, and any flexibility arrangements

7. Remuneration: Base salary, payment schedule, and method of payment

8. Benefits: Mandatory benefits including BPJS social security and healthcare insurance

9. Leave Entitlements: Annual leave, sick leave, and other statutory leave entitlements

10. Confidentiality: Protection of company confidential information and trade secrets

11. Company Policies: Compliance with company regulations and policies

12. Termination: Grounds and procedures for contract termination

13. Governing Law: Specification of Indonesian law as governing law

14. Dispute Resolution: Process for resolving employment-related disputes

15. Entire Agreement: Statement that the contract represents the complete agreement between parties

What sections are optional to include in a Fixed Term Employment Contract?

1. Probation Period: Details of probationary period if applicable (Note: technically not allowed for fixed-term contracts under Indonesian law but sometimes included erroneously)

2. Performance Bonus: Structure and conditions for performance-based compensation, if offered

3. Non-Competition: Post-employment restrictions on working with competitors, if applicable

4. Intellectual Property: IP rights and ownership of work created during employment, relevant for technical or creative roles

5. Mobility Clause: Terms regarding potential workplace relocation or travel requirements

6. Language: Specification of prevailing language if contract is bilingual (Indonesian/English)

7. Remote Working: Terms and conditions for remote work arrangements if applicable

What schedules should be included in a Fixed Term Employment Contract?

1. Schedule 1 - Job Description: Detailed description of role, responsibilities, and performance expectations

2. Schedule 2 - Compensation Details: Breakdown of salary components and benefits

3. Schedule 3 - Company Policies: Key company policies that form part of the employment terms

4. Appendix A - Required Documents: List of documents required from employee (e.g., certificates, ID copies)

5. Appendix B - Mandatory Benefits: Details of statutory benefits and social security arrangements

6. Appendix C - Code of Conduct: Company's code of conduct and ethical standards

Authors

Alex Denne

Advisor @ 蜜桃传媒AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents

Jurisdiction

Indonesia

Document Type

Employment Contract

Cost

Free to use

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