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Contract To Hire Independent Contractor for Indonesia

Contract To Hire Independent Contractor Template for Indonesia

This agreement, governed by Indonesian law, establishes a contract-to-hire relationship between a company and an independent contractor, with the potential for conversion to permanent employment. The document complies with Indonesian Civil Code (KUHPerdata) and Labor Law No. 13 of 2003, outlining the temporary service arrangement, conversion criteria, and terms for potential permanent employment. It includes provisions for intellectual property rights, confidentiality, compensation, and compliance with Indonesian tax and social security regulations, while clearly distinguishing the initial contractor status from employment relationship.

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Contract To Hire Independent Contractor

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What is a Contract To Hire Independent Contractor?

This Contract To Hire Independent Contractor agreement is designed for use in Indonesia when a company wishes to engage a professional service provider initially as an independent contractor with the intention of potentially converting them to a permanent employee after a successful evaluation period. The document complies with Indonesian employment and contract laws, including the Civil Code (KUHPerdata) and Labor Law No. 13 of 2003, while addressing crucial aspects such as contractor status, conversion criteria, intellectual property rights, and social security obligations. It's particularly useful for companies seeking to evaluate contractors before making a permanent hiring decision, providing flexibility while ensuring compliance with Indonesian regulatory requirements.

What sections should be included in a Contract To Hire Independent Contractor?

1. Parties: Identification of the contracting company and the independent contractor, including complete legal names, addresses, and any relevant registration numbers

2. Background: Context of the agreement, including the company's need for services and the contractor's qualifications

3. Definitions: Key terms used throughout the agreement, including 'Services', 'Deliverables', 'Conversion Period', and 'Employment Terms'

4. Scope of Services: Detailed description of the services to be provided by the contractor, including specific responsibilities and deliverables

5. Term and Conversion: Duration of the contractor period and specific conditions for conversion to permanent employment

6. Compensation and Payment Terms: Fee structure, payment schedule, expenses, and any performance-based incentives

7. Independent Contractor Status: Clear statement of contractor status, tax responsibilities, and disclaimer of employment relationship during the contract period

8. Performance Standards: Expected quality levels, KPIs, and performance evaluation criteria

9. Intellectual Property Rights: Ownership and transfer of work products, pre-existing IP, and related rights

10. Confidentiality: Protection of confidential information, trade secrets, and data privacy obligations

11. Termination: Grounds for termination, notice periods, and consequences of early termination

12. Governing Law and Dispute Resolution: Application of Indonesian law and dispute resolution mechanisms

What sections are optional to include in a Contract To Hire Independent Contractor?

1. Non-Competition: Restrictions on working with competitors, used when contractor has access to sensitive information or strategic knowledge

2. Equipment and Resources: Provisions regarding company-provided equipment or resources, included when company provides significant tools or access

3. Insurance Requirements: Specific insurance coverage requirements, included for high-risk services or when required by company policy

4. Training and Orientation: Requirements for specific training or orientation programs, included when specialized knowledge transfer is needed

5. Security Requirements: Specific security protocols and compliance requirements, included when handling sensitive data or accessing secure systems

6. Force Majeure: Provisions for unforeseen circumstances, particularly relevant in long-term or critical service arrangements

What schedules should be included in a Contract To Hire Independent Contractor?

1. Schedule A - Service Description: Detailed scope of work, deliverables, timelines, and performance metrics

2. Schedule B - Compensation Details: Detailed fee structure, payment schedules, and any performance-based incentives

3. Schedule C - Conversion Terms: Specific conditions, timeline, and terms for conversion to permanent employment

4. Schedule D - Company Policies: Relevant company policies and procedures applicable to contractors

5. Appendix 1 - Required Qualifications: List of mandatory qualifications, certifications, and experience requirements

6. Appendix 2 - Compliance Checklist: List of regulatory and company compliance requirements to be maintained

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Indonesia

Publisher

Ƶ

Cost

Free to use
Relevant legal definitions































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Relevant Industries

Information Technology

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Human Resources

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Finance

Information Technology

Operations

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Research and Development

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Engineering

Procurement

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Software Developer

Project Manager

Business Analyst

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Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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