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Final Pay Letter To Employee for Indonesia

Final Pay Letter To Employee Template for Indonesia

A Final Pay Letter To Employee is a formal document issued under Indonesian labor law that details the final payment and entitlements due to an employee upon termination of employment. The document complies with Law No. 13 of 2003 on Manpower and Government Regulation No. 35 of 2021, providing a comprehensive breakdown of all payment components including unpaid salary, pro-rated payments, severance pay, service appreciation pay, compensation for unused leave, and any other statutory entitlements. It serves as an official record of the final settlement between employer and employee, ensuring transparency and legal compliance in the employment termination process.

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What is a Final Pay Letter To Employee?

The Final Pay Letter To Employee is a crucial document required under Indonesian employment law when concluding an employment relationship. It must be issued when an employee's employment ends, whether through resignation, termination, retirement, or contract expiration. The letter serves multiple purposes: it provides a detailed breakdown of all final payments and entitlements, ensures compliance with Indonesian labor regulations (particularly Law No. 13 of 2003 and Government Regulation No. 35 of 2021), acts as proof of final settlement, and helps prevent future disputes regarding terminal benefits. The document typically includes calculations of severance pay, service appreciation pay, compensation rights, unused leave, pro-rated salary, and any other statutory entitlements specific to Indonesian employment law.

What sections should be included in a Final Pay Letter To Employee?

1. Letter Header: Company letterhead, date, reference number, and formal addressing to the employee

2. Employee Details: Full name, employee ID, position/title, and department of the employee

3. Termination Reference: Reference to the termination date and any prior termination notice or mutual agreement

4. Final Payment Components: Detailed breakdown of all payment components including unpaid salary, pro-rated salary, unused leave compensation, and statutory entitlements

5. Severance Payment Details: Calculation and breakdown of severance pay, service appreciation pay, and compensation rights as per Indonesian labor law

6. Payment Method and Timing: Information about when and how the final payment will be made, including bank transfer details if applicable

7. Tax Information: Statement about tax treatment of the final payment and any tax withholding details

8. Company Property Return: List of company properties to be returned and confirmation of returns already made

9. Closing Statement: Formal closing including any appreciation message and contact information for queries

What sections are optional to include in a Final Pay Letter To Employee?

1. Religious Holiday Allowance (THR): Include if termination occurs near the religious holiday period, detailing pro-rated THR calculation

2. Outstanding Loans/Advances: Include if there are any outstanding loans or salary advances to be deducted from final payment

3. Bonus/Commission Details: Include if there are any outstanding bonuses or commissions to be paid

4. Non-Compete/Confidentiality Reminder: Include if the employee was bound by such agreements during employment

5. Benefits Continuation: Include if there are any benefits that continue post-employment

6. Certificate of Employment: Include if providing a separate employment certificate reference

What schedules should be included in a Final Pay Letter To Employee?

1. Final Payment Calculation Sheet: Detailed calculations of all payment components, including statutory entitlements

2. Company Property Checklist: List of company properties to be returned with their status

3. Tax Calculation Sheet: Breakdown of tax calculations and withholdings on final payment

4. Employee Clearance Form: Form showing clearance from various departments (IT, Finance, HR, etc.)

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

Termination Letter

Cost

Free to use
Relevant legal definitions




















Clauses






















Relevant Industries

Manufacturing

Technology

Financial Services

Retail

Healthcare

Education

Construction

Mining

Agriculture

Hospitality

Telecommunications

Professional Services

Energy

Transportation

Real Estate

Media and Entertainment

Non-Profit Organizations

Government Institutions

Consumer Goods

Industrial Services

Relevant Teams

Human Resources

Finance

Legal

Payroll

Compliance

Employee Relations

Administration

Risk Management

Relevant Roles

HR Director

HR Manager

Payroll Manager

Finance Director

Finance Manager

Legal Counsel

HR Administrator

Payroll Administrator

HR Business Partner

Compensation and Benefits Manager

HR Operations Manager

Chief Financial Officer

Employee Relations Manager

HR Specialist

Compliance 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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