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Employee Outsourcing Agreement for Indonesia

Employee Outsourcing Agreement Template for Indonesia

A comprehensive agreement governed by Indonesian law that establishes the terms and conditions for the provision of outsourced employees from a professional employment service provider to a client company. The document complies with Indonesian labor regulations, particularly Law No. 13 of 2003 on Manpower and Minister of Manpower Regulation No. 19 of 2012, covering aspects such as service scope, employee management, compliance requirements, social security obligations, and operational procedures. It includes provisions for worker protection, service levels, liability allocation, and dispute resolution mechanisms within the Indonesian legal framework.

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What is a Employee Outsourcing Agreement?

The Employee Outsourcing Agreement is a crucial document for businesses operating in Indonesia that wish to engage workers through a professional employment service provider. This arrangement is specifically regulated under Indonesian labor law, requiring careful compliance with Law No. 13 of 2003 on Manpower and related regulations. The agreement is designed for situations where companies need flexible workforce solutions while ensuring compliance with local labor requirements. It covers essential aspects such as employee rights, social security obligations, workplace safety, and service provider responsibilities. The document is particularly relevant for companies seeking to outsource non-core business activities, as permitted under Indonesian law, while maintaining clear legal relationships and responsibilities between all parties involved.

What sections should be included in a Employee Outsourcing Agreement?

1. Parties: Identification of the Outsourcing Service Provider and the Client Company

2. Background: Context of the agreement, including the Client's need for outsourced workers and the Provider's capabilities

3. Definitions: Key terms used throughout the agreement, including 'Outsourced Employees', 'Services', 'Workplace'

4. Scope of Services: Detailed description of outsourcing services, types of positions, and work activities covered

5. Term and Renewal: Duration of the agreement and conditions for renewal

6. Provider Responsibilities: Obligations of the outsourcing company including recruitment, training, and employee management

7. Client Responsibilities: Client's obligations regarding workplace safety, supervision, and cooperation

8. Employee Management: Procedures for recruitment, replacement, attendance, and performance management

9. Compliance Requirements: Adherence to Indonesian labor laws, social security requirements, and relevant regulations

10. Fees and Payment Terms: Service fees, payment schedule, and related financial terms

11. Confidentiality: Protection of confidential information of all parties

12. Data Protection: Handling and protection of employee and company data

13. Liability and Indemnification: Allocation of risks and responsibilities between parties

14. Termination: Grounds and procedures for agreement termination

15. Dispute Resolution: Procedures for resolving disputes under Indonesian law

16. General Provisions: Standard clauses including notices, amendments, and governing law

What sections are optional to include in a Employee Outsourcing Agreement?

1. Foreign Worker Provisions: Required when the agreement involves placement of foreign workers, including visa and permit requirements

2. Specialized Training: Include when specific training or certifications are required for the outsourced employees

3. Intellectual Property Rights: Required when outsourced employees will be involved in creating or handling IP

4. Non-Competition: Include when employees will have access to sensitive competitive information

5. Transfer of Employees: Required when there's possibility of permanent transfer of employees to the client

6. Insurance Requirements: Additional insurance requirements beyond mandatory social security

7. Force Majeure: Specific provisions for handling disruptions due to unforeseen circumstances

8. Anti-Corruption Compliance: Required for agreements with international companies or government-linked entities

What schedules should be included in a Employee Outsourcing Agreement?

1. Schedule 1 - Service Specifications: Detailed description of services, positions, and job descriptions

2. Schedule 2 - Fee Schedule: Detailed breakdown of fees, charges, and payment calculations

3. Schedule 3 - Service Levels: Performance metrics and service level requirements

4. Schedule 4 - Employee Benefits: Description of employee benefits package and entitlements

5. Schedule 5 - Operational Procedures: Detailed procedures for daily operations, reporting, and communication

6. Schedule 6 - Required Certifications: List of mandatory certifications and qualifications for employees

7. Schedule 7 - BPJS Compliance: Details of social security and health insurance compliance

8. Appendix A - Standard Operating Procedures: Specific workplace procedures and protocols

9. Appendix B - Reporting Templates: Standard forms and templates for regular reporting

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

Document Type

Employment Contract

Cost

Free to use
Relevant legal definitions


















































Clauses















































Relevant Industries

Manufacturing

Technology

Financial Services

Retail

Hospitality

Logistics and Supply Chain

Construction

Mining

Healthcare

Telecommunications

Business Process Outsourcing

Facilities Management

Industrial Services

Consumer Goods

Relevant Teams

Human Resources

Legal

Procurement

Operations

Compliance

Finance

Risk Management

Facilities Management

Contract Administration

Business Development

Relevant Roles

Human Resources Director

Legal Counsel

Procurement Manager

Operations Director

Compliance Officer

HR Manager

Facilities Manager

Operations Manager

Contract Manager

Business Development Manager

Risk Manager

Chief Financial Officer

General Counsel

HR Business Partner

Chief Operating Officer

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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