Rajah & Tann Regional Round-Up
your snapshot of key legal developments in Asia
Issue 1 - Jan/Feb/Mar 2021
 

A New Age in Employment

Following the enactment of the Omnibus Law, the Government issued Government Regulation No. 35 of 2021 to further regulate fixed-term employment agreement, outsourcing, working hours and time-off, and termination of employment.


While the changes brought by this regulation are extensive, the below key points are worthy of highlighting:


  1. The maximum term of a fixed-term employment agreement is now increased from two years to five years. Employers should note that they must pay compensation after the expiration of the agreement.

  2. A court approval is no longer required to terminate employment. Employers can terminate by simply issuing a notification of termination at least 14 days before the termination date.

  3. New termination payment formulae that categorise the amount that must be paid based on the reason for termination have been introduced.

  4. Outsourcing companies must obtain a license from the Ministry of Manpower. An outsourcing company must also enter into an employment agreement with each outsourced employee.



Please note that whilst the information in this Update is correct to the best of our knowledge and belief at the time of writing, it is only intended to provide a general guide to the subject matter and should not be treated as a substitute for specific professional advice.

 

Assegaf Hamzah & Partners
Jakarta Office
Level 36 & 37, Capital Place
Jalan Jenderal Gatot Subroto Kav 18
Jakarta 12710, Indonesia

Surabaya Office
Pakuwon Center, Superblok Tunjungan City
Lantai 11, Unit 08
Jalan Embong Malang No. 1, 3, 5,
Surabaya 60261, Indonesia
http://id.rajahtannasia.com


Contacts:

Bono Daru Adji
Senior Partner
D +62 21 2555 7800
F +62 21 2555 7899
bono.adji@ahp.co.id

Ahmad Fikri Assegaf
Senior Partner/Co-Founder
D +62 21 2555 7800
F +62 21 2555 7899
ahmad.assegaf@ahp.co.id

Chandra M Hamzah
Partner
D +62 21 2555 7800
F +62 21 2555 7899
chandra.hamzah@ahp.co.id

Eri Hertiawan
Partner
D +62 21 2555 7800
F +62 21 2555 7899
eri.hertiawan@ahp.co.id

Ibrahim Sjarief Assegaf
Managing Partner
D +62 21 2555 7800
F +62 21 2555 7899
ibrahim.assegaf@ahp.co.id


Rajah & Tann Singapore LLP


Contacts:

Hamidul Haq
Partner
D +65 62320398
hamidul.haq@rajahtann.com

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