6 questions
Not at will — Indonesian law prescribes both a process and a price. The process: bipartite talks first, mandatory, up to 30 working days; then government mediation; then the industrial relations court if it gets that far. The price: the statutory severance package, scaled by the ground of termination. Skipping the process does not skip the price — it usually raises it and adds a court case.
See the service: Employment Agreement Drafting (Fixed-Term & Permanent)
Three components, then a multiplier. Base severance runs from one month's wage for under a year of service up to nine months for eight years and above; the long-service award and rights compensation stack on top; then the whole schedule is multiplied by a coefficient set by the ground of termination — efficiency, misconduct, retirement and resignation all multiply differently. So 'what does terminating cost' has no one-line answer, but it does have an exactly calculable one for your facts.
See the service: Employment Agreement Drafting (Fixed-Term & Permanent)
A fixed-term contract fits genuinely temporary work: maximum five years including all extensions, and it must be written — get the type wrong and the law converts it to permanent. A permanent contract is the default for ongoing roles, and that is where flexibility actually lives at the start, through probation. The wrong choice is expensive in both directions; matching contract to role is a ten-minute decision that prevents a year of dispute.
See the service: Employment Agreement Drafting (Fixed-Term & Permanent)
Only in a permanent contract — maximum three months, and you cannot pay below minimum wage during it. In a fixed-term contract, probation is void by law, and since the labour law changes those 'probation' months count as service anyway: you gained nothing and started the clock.
See the service: Employment Agreement Drafting (Fixed-Term & Permanent)
Yes — and this is the payment Bali employers most often miss. Every fixed-term contract that ends, even by simple expiry, owes compensation money to a worker with at least a month's service: pro-rata, months of service divided by 12, times one month's wage. It is not severance; it is a separate statutory bill that exists precisely because the contract ended.
See the service: Employment Agreement Drafting (Fixed-Term & Permanent)
Two standing duties employers discover late: registering yourself and your workers for social security, and — once you reach ten employees — having a ratified company regulation. Both are cheap to do and expensive to be caught without, because both surface in every dealing with the manpower office and in every dispute.
See the service: Company Regulation (Peraturan Perusahaan) Drafting & Ratification
This is general information for business owners, not legal advice for your own situation. If your circumstances are specific, ask — it is cheaper to ask now than to repair later.
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Last checked: 2026-08-03