INDUSTRIAL RELATION 1

MEETING 2 & 3
EMPLOYMENT RELATIONS
WORK AGREEMENT

ALDEN NELSON,ST, MM, CPIR, CHCM

 LEARNING OBJECTIVES

You should be able to :

1. Understand and able to explain the employment relations
2. To define and explain the work agreement
3. Able to make a work agreement
 REFERENCES

You should read :

1. UU No 13 Tahun 2003 (Manpower)
2. PERPU No 2 Tahun 2022 (Cipta Kerja )
 INTRODUCTION

• Due to UU No 11 Tahun 2020 absolute, the

government released PERPU No 2 Tahun
2022 due to implement of Mahkamah
Konstitusi’s decision Nomor 9 I/PUU-XVIII/
2O2O, need to improve and replace UU
Nomor 11 Tahun 2O2O tentang Cipta Kerja
 DEFINITION PERPU

• Peraturan Pemerintah Pengganti Kedudukan Perpu setara

Undang-Undang (Perpu) adalah dengan UU, namun untuk
menjadi UU, Perpu harus
Peraturan Perundang-undangan
mendapat persetujuan
yang ditetapkan oleh Presiden DPR agar dapat
dalam hal ihwal kegentingan ditetapkan sebagai UU.
yang memaksa.
• (Pasal1angka 4 UU Nomor 12 Tahun 2011
tentang Pembentukan Peraturan Perundang-
undangan)
IMPLEMENTATION OF PERPU
 EMPLOYMENT RELATIONSHIP

❖An employment relation is a relationship between an

entrepreneur and a worker/ labourer based on a work
agreement, which contain the elements of :
1. Job/Work
2. Wages, and
3. Orders.
❖Employment relation exists because of the existence of a work
agreement between the entrepreneur and the worker/labourer.

Article 1 No 15, UU No 13 Tahun 2003

 WORK AGREEMENT

1. Work agreements can be made either orally or in writing.

2. Work agreements that specify requirements in writing shall be
carried out in accordance with valid legislation.

Article 51 UU No 13 Tahun 2003

AGREEMENT

An action by which one person or more ties himself to one or

more people (Article 1313 Burgerlijk Wetboek/ BW ).
 ELEMENTS IN THE AGREEMENT

1. Acts
The use of the word "act" in the formulation of this agreement is
more appropriate if it is replaced with the word legal action,
because the action has legal consequences for the parties to the
agreement.
 ELEMENTS IN THE AGREEMENT

2. One or more people towards one or more other people

For an agreement to be made, there must be at least two parties facing each
other and giving each other a statement that fits each other. The party is a
person or legal entity.
3. Binding him/ herself
In the agreement there is an element of promise given by one party to another
party. In this agreement people are bound to legal consequences arising out of
their own free will.
 VALID WORK AGREEMENT
(PSL. 1320 BW) AND LAW NO 13 YEAR 2003

a. Agree of those who bound themselves; (agreement both parties)

b. Ability to make a commitment (Capability/Competence perform legal
actions);
c. A certain subject matter (the existence of the work promised);
d. A reason that is not forbidden (Work does not conflict with public
order, morale).

Article 52 UU No 13 Tahun 2003

 VALID WORK AGREEMENT
The Employment Agreement is made on the basis of

capability The job

agreement The job is not
or which the against
both parties have
competenc laws and
parties agreed regulations.
e

Article 52 UU No 13 Tahun 2003

 CANCELLATION OF AGREEMENT

• The first and second conditions are subjective, and if there is a

violation then the agreement "can be canceled“.
• The third and fourth conditions are objective, and if not fulfilled,
the agreement is "null and void/ Not valid based on law".
 WORK AGREEMENT

Agreement between worker / laborer

with employer which contains the
terms of work, rights and
obligations of the parties
 WORK AGREEMENT

➢ A work agreement means that the worker commits himself to work for
the employer and vice versa the employer commits himself to provide
work in exchange for wages and others, as stipulated in the terms of
employment

➢ The meaning of "working for the employer" indicates that the worker
does the work under the orders of the employer / employer.
 WORK AGREEMENT

• A work agreement cannot be withdrawn and/or

changed unless the parties agreed otherwise

Article 55, UU No 13 Tahun 2003

 WORK AGREEMENT

Specified time / PKWT

(contract)

TYPE
Unspecified time /
PKWTT (Permanent)

Article 57 PERPU No 2 ( 2022)

 WORK AGREEMENT
SPECIFIED TIME /PKWT (CONTRACT)

1. The work agreement for a certain time cannot require a

probationary period
2. In the event that a probationary period as referred to in
paragraph 1 is required, the probationary period required is
null and void and the working period is still counted.

Article 58 PERPU No 2 ( 2022)

 WORK AGREEMENT
Valid legislation

Article 61 UU No 13 ( 2003 ) Article 61 PERPU No 2 ( 2022)

 WORK AGREEMENT
1. A work agreement comes to an end if:
a. The worker dies; or
b. Expiration of the term of the work agreement
c. Completion of a certain job
d. There is a court decision and/or institutional decision settlement of
industrial relations disputes already has permanent legal force; or
e. The existence of certain conditions or events listed in the work
agreement, company regulations, or collective bargaining agreement that can
cause termination of employment

Article 61 PERPU No 2 Tahun 2022

 WORK AGREEMENT

2. The work agreement does not end due to the death of the entrepreneur or
transfer of rights to the company due to the sale, inheritance, or grant
3. In the event of a transfer of the company, the rights of the workers become
the responsibility of the new entrepreneur, unless otherwise specified in the
transfer agreement that does not reduce the rights of labor workers
4. In the event that an individual entrepreneur dies, the heirs Employers can
terminate the employment agreement after negotiating with labor workers
5. In the event that a worker worker dies, the worker's heirs entitled to get their
rights in accordance with the laws and regulations invitations or rights that
have been regulated in the work agreement, company regulations, or collective
labor agreements

Article 61 PERPU No 2 Tahun 2022

 END OF WORK AGREEMENT

If one of the parties terminates the employment relationship before

the expiry of the period specified in the a certain time work
agreement or the end of the relationship work not because of the
provisions as referred to in Article 61 paragraph 1 the party
terminating the employment relationship obliged to pay
compensation to the other party equal to the wages of the laborer
until the expiration date term of employment agreement labor
agreements

Article 62 PERPU UU No 2/2022

 WORK AGREEMENT
SPECIFIED TIME /PKWT (CONTRACT)

PKWT is based on:

1. Period of time or
2. Completion of a certain job
3. Other specific jobs the type and nature or activities
are not fix
 WORK AGREEMENT
SPECIFIED TIME /PKWT (CONTRACT)

PKWT is based on period of time

1. Work that is estimated to be completed not too long;
2. Work that is seasonal or
1
3. Work related to new product, new activity, or product
additions that are still in trial or exploration
 WORK AGREEMENT
SPECIFIED TIME /PKWT (CONTRACT)

1.1
PKWT based on period of time :
Estimated job completion in time
not too long
The maximum term is
5 years
Can be extended based on
an agreement with the
total term of the PKWT and
the extension is no longer
than 5 years.
 WORK AGREEMENT
SPECIFIED TIME /PKWT (CONTRACT)

Season or weather
1.2 The work that is carried out depending
on the season or the weather can only
PKWT based on period be done in certain season or weather
of time :
Seasonal Certain Conditions
The work that is carried out
depending on certain conditions as
an additional job made to fulfill orders
or a specific target
 WORK AGREEMENT
SPECIFIED TIME /PKWT (CONTRACT)

New product” means a product that

1.3 has never existed before or a
development of an existing product.
PKWT is based on period of
time :
Work related to new New activities” is a business just
product implemented by the company.

Work related to new products,

new activities, or additional products
that are still under trial or exploration
 WORK AGREEMENT
SPECIFIED TIME /PKWT (CONTRACT)

2 Work that will be

completed at once; or
PKWT based on completion
of a certain job
Work is temporary

The period of time is based on the agreement of the parties and can
be extended to a certain time until the completion of the work.
 WORK AGREEMENT
SPECIFIED TIME /PKWT (CONTRACT)

3 Work changes in terms of

time and volume of work
PKWT based on specific jobs
the type and nature or
activities are not fix Wages based on attendance

Daily work agreement

 WORK AGREEMENT
SPECIFIED TIME /PKWT (CONTRACT)

The work is less than 21 days in

3 a month

daily
PKWT based on If the work reaches 21 days or
work agreement more for 3 consecutive months
will be PKWTT

Work agreement in written and

can be made collective
 WORK AGREEMENT
SPECIFIED TIME /PKWT (CONTRACT)

3 Work agreement made in written

and can be made collective which
daily
PKWT based on at least contains:
a. name / address of company
work agreement or employer;
b. worker name / address;
c. type of work performed;
d. amount of Wages.
 GENERAL REQUIREMENTS OF
PKWT (CONTRACT)
PKWT contains at least:
a. Name, address of the company and type of business;
b. Worker's name, gender, age, and address;
c. Position or type of work;
d. Place of work;
e. Amount of wages and method of payment;
f. Rights and obligations of employers and workers in accordance
with the provisions of laws and regulations and / or work
conditions stipulated in the PP / PKB
g. Starting and the period of validity of the PKWT;
h. The place and the date when PKWT were made; and
i. Signatures of the parties inside the PKWT.
 GENERAL REQUIREMENTS OF
PKWT (CONTRACT)

A permanent employment agreement shall be drawn up in

writing as well as must use the Indonesian language and
Latin alphabets. (Article 57 Paragraph 1 of Manpower Law)

Prohibition on PKWT
➢ PKWT cannot require a probationary period. (Article
57 of UUK & Article 12 of PP 35/2021)
➢ PKWT cannot be held for permanent work. (Article 4
Paragraph 2 of PP 35/2021)
GENERAL REQUIREMENTS OF
PKWT (CONTRACT)

PKWT registration
➢ PKWT must be registered online at the Ministry of
Manpower no longer than 3 days after the PKWT is
signed.
➢ As long as the online registration system is not yet
available, registration will be made through the
Manpower Office of District / City, 7 days after the
PKWT is signed. (Article 14 PP 35/2021)
 COMPENSATION MONEY ( CM ) FOR
SPECIFIED TIME /PKWT (CONTRACT)

If PKWT is
1 Given when end extended, CM given
of PKWT 3
before PKWT
extended

Service period CM PKWT extension

2 at least 1 month 4 is given when
completion of
extension

Article 15 Paragraph 3 of PP 35/2021

 CALCULTION COMPENSATION MONEY ( CM ) FOR
SPECIFIED TIME /PKWT (CONTRACT)

1 Salary without
Allowance
Basic salary ( if basic
3 salary and non fix
allowance)
Basic salary
2
and Fix
allowance

Article 16 Paragraph 3 of PP 35/2021

 COMPENSATION FOR
SPECIFIED TIME /PKWT (CONTRACT)

The amount of compensation money is given in accordance with the

following conditions:
a. PKWT for 12 months continuously, is given the amount of 1 month
of wages;
b. PKWT for 1 month or more but less than 12 months or more than
12 months, are calculated proportionally by calculating:

Service period × 1 month salary

12

(Article 16 of PP 35/2021)
 EXEMPTION OF COMPENSATION MONEY FOR
END OF PKWT (CONTRACT)

➢ Compensation money will not be given if the PKWT work period is

less than 1 month, or the PKWT ends because: (1-3: Article 61A UUK)
1. Pass away;
2. There is a court decision and / or a PPHI institution decision that has
permanent legal force;
3. There are certain circumstances or events that are stated in the
work agreement, PP / PKB that can cause the termination of the
working relationship; or
4. The workers are foreign workers; (Article 15 Paragraph 5 of PP
35/2021)
➢ Compensation money for workers in micro and small businesses is
given according to the agreement.

(Article 16 of PP 35/2021)
COMPENSATION MONEY FOR UNILATERAL
TERMINATION OF PKWT (CONTRACT)

In the event that one of the parties terminates the

employment relationship before the end of the period
stipulated in the PKWT (Unilateral PHK), the employer is
obliged to provide compensation money, the amount of
which is calculated based on the period of the PKWT that
has been implemented by the Worker / Laborer.

(Article 17 of PP 35/2021)
 THE CHANGE PKWT BECOME PKWTT

➢ PKWT which is not made in Indonesian and Latin letters

➢Violating specific requirements for the types of work permitted

for PKWT
 UNSPECIFIED TIME / PKWTT (PERMANENT)

➢ May require a probation period not more than 3 months.

➢ In the probation period employers are prohibited from paying wages
below the minimum wages
➢ In the event that an unspecified time employment agreement is made
verbally, the employer is required to make a letter of appointment for the
worker / laborer concerned.

(Article 60 & 63 of UU 13/2003)

 UNSPECIFIED TIME / PKWTT (PERMANENT)

The letter of appointment shall at least contain information

concerning:
a. The name and address of the worker/ labourer
b. The date the worker starts to work;
c. The type of job or work; and
d. The amount of wages.

(Article 63 of UU 13/2003)
Individual Assignment
THANK YOU