New Expatriate Work Regulations in Indonesia – Updated

New Expatriate Work Regulations in Indonesia – Updated

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Ministry of Manpower Regulation 35/2015

 1. General purpose of controlling foreign workers:

  • To protect the Indonesian labor market, to ensure that Indonesians can work in their field and also get proper compensation/salary
  • To protect Indonesian workers from globalization, including from the ASEAN Community. It is implied that any foreign workers working in Indonesia should have proper competency based on the positions allowed by regulation to be filled by foreign workers.
  • To prevent professional Indonesian workers from seeking jobs outside Indonesia, to give them appreciation and a salary based on their profession and expertise
  • To save foreign exchange being used by companies to pay foreign workers.
  • The new regulation mentioned that Associations (UB-Usaha Bersama) and Cooperatives are no longer allowed to hire foreign workers, unless permitted under prevailing laws and regulations

2. Significant changes in requirements to hire foreign workers:

Old Regulation (MoM 12/2013) New Regulation (MoM 16/2015)
Foreign workers need to have a similar education background with their appointed position No Changes
Diploma/resume/certificate of competence relevant to their appointed position, at least five  years’ experience needed Certificate of competence, Have at least five years’ experience relevant to the position
Obligation to transfer knowledge to Indonesian workers (TKI Pendamping) No changes
Bahasa Indonesia competency requirement No longer required
Evidence of an insurance from Indonesian entity provider
Enrolled in National Social Security Program (SJSN) (if stay more than 6 months)
Taxpayer Registration Number (NPWP) (if stay for more than 6 months)

3. The new regulation states that employers of foreign manpower must employ at least 10 Indonesian workers for every one foreign worker.

Update October 2015: this ratio requirement was removed from the 35/2015 regulation update.

4. Temporary RPTKA and Temporary IMTA is now required for:

  • Providing guidance, counselling, training in implementation and development of innovative industrial technology to improve product quality and design and cooperation in offshore marketing of Indonesian goods and services
  • Making commercial films with a permit from the authorized institution
  • Giving seminars/lectures
  • Participating in meetings with the central or representative office in Indonesia
  • Conducting audits, quality, control and inspections of Indonesia branches
  • Foreign manpower on probation

Temporary work permit no longer required for attending meetings and giving trainings
Previous work permit regulation (16/2015) stated that for the purpose of attending meetings, giving speeches, giving training for the purpose of increasing industrial quality, for one time job assignments a foreigner is required to have temporary work permit.

This confused foreign investors as those activities previously could be held under a business visa. Ministry of Manpower responded and from the updated regulation (35/2015) this article has been removed.

5. IMTA – Foreign Workers Employment Permit is now required for foreign-domiciled Board of  , Directors, Board of Commissioners, Patrons, Executives and Supervisors

Update October 2015: this article was removed from the regulation and non-resident commissioners and directors are no longer required to have work permit.

6. Appointed Indonesian understudy worker should have relevant education background with foreign worker’s appointed position. Exception applied for: foreign workers under Temporary RPTKA and Urgent RPTKA, Board of Directors, Board of Commissioners, Patrons, Executives and Supervisors.

7. The new regulation introduces an online system for the application process. Ekspos/Interview (Penilaian Kelayakan) by Ministry of Manpower can now be done via Skype, one company only allowed to have one account. The online application can be submitted to www.tka-online.depnakertrans.go.id

8. The new regulation no longer requires TA.01 as requirement to obtain IMTA. Here is the full process to obtain RPTKA and IMTA.
old vs new process

RPTKA Application process

9. RPTKA  document requirements Download form here

General RPTKA Temporary RPTKA
Process Maximum 3 days Maximum 3 days
Max. duration Max 5 years, extendable Max 1 month, not extendable
Documents Required
  1. Reason for hiring foreign employee
  2. Completed RPTKA form
  3. Business permit
  4. Company’s deed of establishment
  5. Organization structure
  6. Letter of recommendation
  7. Domicile letter
  8. Tax Identification Number (NPWP)
  9. Statement letter to appoint Indonesian understudy workers

10. Statement letter to give education and training to Indonesian workers related to assigned position to foreign workers

11. Compulsory company manpower report

  1. Reason for hiring foreign employee
  2. Completed RPTKA form
  3. Business permit
  4. Company’s deed of establishment
  5. Organization structure
  6. Employment contract
  7. Domicile letter
  8. Tax Identification Number (NPWP)
  9. Compulsory company manpower report

 

10. IMTA  document requirements Download form here

General IMTA Temporary IMTA
Process Maximum 3 days Maximum 2 days
Max. duration Max 1 years, extendable Max 1 month, not extendable
Documents Required
  1. DKP-TKA proof of payment
  2. RPTKA
  3. Foreign worker’s passport
  4. Statement letter of appointed Indonesian worker
  5. Education relevant to foreign worker position
  6. Certificate of competence/ working experience of 5 years related to the position
  7. Draft Employment contract
  8. Evidence of insurance from Indonesian entity provider
  9. Letter of recommendation from relevant institutions.
  10. Photo 4×6
  11. Point no 4, 5, 6 and 7 is not required for BoD, BoC, Patrons, Executive and Supervisors.
  12. Additional docs: company’s deed of establishment (for BoD, BoC, patrons, executive and supervisors)
    1. DKP-TKA proof of payment
    2. RPTKA
    3. Evidence of insurance from Indonesian entity provider
    4. Foreign worker’s passport, which already includes visa
    5. Photo 4×6

Extending work permit

In order to extend work permit (IMTA), following documents need to be prepared:

  • Proof of payment of DPKK (US$1200/year)
  • Copy of proof of payment to the foreign worker
  • Copy of foreign worker tax card (NPWP)
  • Copy of insurance policy from an Indonesian-based insurance company
  • Copy of joining national security program
  • Copy of appointment of Indonesian co-worker (only for Non Director and Non Commissioner)
  • Realization report of transfer of knowledge and Indonesian co-worker training

The changes in the regulations make it absolutely crucial that foreign nationals extend their limited stay permits and work permits on time. Otherwise they’ll permits lose validity and the process needs to be started from beginning again and this time following the new regulations.

Start the extension process at least 2 months before the KITAS and IMTA expire.

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1 COMMENT

  1. New Expatriate Work Regulations in Indonesia

    Article on new-expatriate-work-regulations-in-Indonesia is very informative.

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