The Employee Termination Release Agreement is a crucial document used in Indonesian employment relationships when formalizing the end of employment. It serves as a legally binding instrument that protects both employer and employee interests during separation, ensuring compliance with Indonesian labor laws, particularly the Omnibus Law (Law No. 11 of 2020) and Government Regulation No. 35 of 2021. This agreement is typically used when employment is terminated by mutual consent, redundancy, or other legitimate grounds under Indonesian law. It details severance calculations, final payments, benefit arrangements, and includes mutual releases of claims. The document must carefully balance the mandatory employee protections under Indonesian law with the employer's need for finality in the termination process.
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1. Parties: Identification of the employer and employee, including complete legal names and addresses
2. Background: Context of the employment relationship, including start date, position, and brief reason for termination
3. Definitions: Key terms used throughout the agreement, including specific Indonesian legal terminology
4. Termination Date: Specific date of employment termination and last working day
5. Severance Package: Detailed breakdown of severance pay, service appreciation pay, and compensation rights as per Indonesian regulations
6. Final Payments: Details of final salary, pro-rated benefits, and other outstanding payments
7. Company Property: Requirements for return of company property and confidential information
8. Release of Claims: Mutual release of claims and waiver of rights, subject to Indonesian law limitations
9. Continuing Obligations: Post-employment obligations including confidentiality and non-disparagement
10. Tax Treatment: Tax handling of termination payments as per Indonesian tax regulations
11. Governing Law: Confirmation of Indonesian law as governing law and jurisdiction
12. Execution: Signature blocks and execution requirements
1. Non-Competition: Restrictions on future employment, if applicable and enforceable under Indonesian law
2. Reference Letter: Terms regarding the provision of employment references
3. Medical Benefits Extension: Continuation of medical benefits, if offered beyond termination
4. Repatriation: For expatriate employees, terms regarding return travel and shipping
5. Training Cost Recovery: If applicable, terms for recovering training costs as allowed by Indonesian law
6. Resignation from Positions: For senior employees, resignation from director or officer positions
7. Social Security Transition: Details regarding BPJS Employment and Health insurance transition
1. Schedule A - Severance Calculation: Detailed calculation of severance pay according to Indonesian labor law formula
2. Schedule B - Final Payment Breakdown: Itemized list of all final payments including salary, benefits, and deductions
3. Schedule C - Company Property List: Inventory of company property to be returned
4. Appendix 1 - Employment History: Summary of employment period, positions held, and salary history
5. Appendix 2 - Benefits Statement: Statement of all benefits and entitlements up to termination date
6. Appendix 3 - Tax Calculations: Breakdown of tax treatment for various payment components
Relevant legal definitions
Clauses
Relevant Industries
Manufacturing
Technology
Financial Services
Retail
Healthcare
Construction
Mining
Agriculture
Education
Transportation
Hospitality
Professional Services
Energy
Telecommunications
Media & Entertainment
Relevant Teams
Human Resources
Legal
Finance
Payroll
Compliance
Employee Relations
Corporate Secretariat
Risk Management
Industrial Relations
Relevant Roles
Human Resources Director
HR Manager
Legal Counsel
Employment Lawyer
HR Business Partner
Compensation & Benefits Manager
Employee Relations Manager
HR Operations Manager
Payroll Manager
Chief Human Resources Officer
General Counsel
Finance Director
Chief Financial Officer
Company Secretary
Compliance Officer
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