Work Permits For Foreign Workers in Indonesia – Procedure and Overview

Work Permits Indonesia Overview Procedure

The arrangement of foreign workers work permits in Indonesia is regulated by the Ministry of Manpower (MOM) regulation number 10 of 2018 (MOM Regulation 10/2018). MOM Regulation 10/2018 is an implementing regulation of the Presidential Regulation 20/2018 and sets out the latest procedure for the arrangement of the foreign worker work permit. In this article we will discuss the procedure, restrictions and requirements for foreigners and their companies who wish to obtain a work permit.

IMTA is replaced by Notification

Under the new MOM Regulation 10/2018, the foreign worker work permit now consists out of an expatriate placement plan (RPTKA) and a Notification. There is no longer a separate work permit (IMTA). In practice however, not much has changed and the change from IMTA to Notification is merely a change of name. A foreign worker can only start working in Indonesia after the RPTKA and Notification are issued by the MOM.

RPTKA validity

Under the MOM Regulation 10/2018, the validity of the RPTKA can be up to 5 years. However this seems to be in violation of the Manpower Law, which states that a Fixed Term Employment Agreement is valid for a maximum period of 2 years, can be extended for 1 year and can be renewed for maximum 2 years. In practice work permits are only approved for a maximum period of 2 years, however in the majority of cases, work permits are approved for only 1 year.

Investors do not require a work permits

Foreign directors and commissioners are not required to apply for work permits (RPTKA and Notification), in case they are also holding a substantial amount of shares in the same Indonesian Company (PT PMA). These foreigners are considered investors and do only require an investor stay permit (investor ITAS). Because these foreign investors are no longer required to obtain a work permit, their obligation to pay the monthly USD 100.00 to the Manpower Development Fund (DPKK / DKP-TKA) is waived.

Indonesian Language Requirement

Under the MOM Regulation 10/2018 makes it mandatory for companies to facilitate Indonesian language education and training for foreigners who hold a long term work permit. The language training is not required for directors, commissioners and foreign workers who are using a short term or urgent/emergency work permit. The MOM has stated that the foreign workers require a language training certificate from an authorized institution. Until to date, the MOM has not implemented the Indonesian language requirement, and it is not clear when (or if) this will be implemented in the near future. Historically, the language requirement has always met great resistance from the international business community in Indonesia.

Double job title exemption

Generally, foreign workers can only be employed under one position (job title) by one Indonesian company. There are however a few exemptions to this rule. MOM Regulation 10/2018 allows foreigners who work in the vocational education & training sector, the oil and gas [K3S] sector and the digital economy sector to have multiple job titles under multiple companies. In addition, foreign directors and commissioners are allowed to have director or commissioner positions in other Indonesian companies. When foreigners are employed under multiple companies, they are required to apply for a work permit for each company they are employed at.

Emergency work permits

When foreign workers apply for an emergency work permit, they currently cannot enter Indonesia before the issuance of their RPTKA and Work Permit (IMTA). Under the MOM Regulation 10/2018, the foreign workers can immediately enter Indonesia using a Visa on Arrival, and start working. The RPTKA can be submitted at latest 2 days after the foreign workers are working.