Govt Issues Regulation on Foreign Worker Recruitment
Date 5 April 2018
In an effort to support the national economy and provide more employment opportunities through investment, the Indonesian Government considers it necessary to re-regulate the permit for the use of foreign workers.
Based on this consideration, President Joko Widodo on 26 March 2018 signed President Regulation Number 20 Year 2018 on Recruitment of Foreign Workers (link to related President Regulation).
The regulation also states that, the recruitment of foreign workers shall be carried out by the Foreign Workers’ Employers in the employment relations for a certain position and a certain time, conducted with due regard to labor market conditions in the country.
Each of the Employers, according to this Regulation, shall also prioritize recruiting Indonesian workers in all kinds of positions available. In the event that the intended position cannot be occupied by the Indonesian workers, the position can be occupied by foreign workers.
Foreign workers are prohibited from occupying positions dealing with human resources and/or certain positions established by the Minister, Article 4 paragraph (1,2) of this Presidential Regulation says.
This Presidential Regulation also notes that the Employers in certain sectors may employ foreign workers who are already employed by the other Employers in the same position, with maximum time until the expiration working period of the foreign workers as the work contract the foreign workers with the First Employers.
As for type of position, sector, and procedures for the use of foreign workers as intended, according to this regulation, shall be further regulated by a Ministerial Regulation.
This Regulation also regulates that each of the Employers which use foreign workers should have Foreign Worker Use Plan (RPTKA) authorized by the Minister or appointed official, and at least contains: a. reasons for the use of foreign workers; b. position of foreign workers in the company organizational structure; c. contract duration of foreign workers; and d. appointment of Indonesian workers as a companion to the related foreign workers employed.
Employers of foreign workers are not required to have RPTKA to employ foreign workers who are: a. a shareholder who is a member of the Board of Directors or a member of the Board of Commissioners of the Employer; b. diplomatic and consular officers to representatives of foreign countries; or c. on the type of work required by the government, Article 10 paragraph (1) of this Presidential Regulation states.
For emergency and urgent work, according to this Regulation, the Employers may employ foreign workers by submitting applications for approval of RPTKA to the Minister or appointed official no later than 2 (two) working days after the foreign workers worked. Furthermore, the approval of RPTKA shall be issued no later than one working day after the application is received completely.
The Employers who will employ foreign workers submit candidate data to the Minister or appointed official, contains: a. name, sex, place and date of birth; b. nationality, passport number, period of passport validity, and the place of passport issued; c. name, position, and period of work; d. statement of guarantee from the Employers; and e. education certificate and certification of work experience or competence in accordance with the terms of occupation that will be occupied by foreign workers.
Article 14 paragraph (3) of this Presidential Regulation reads “The Minister or the appointed official shall submit the data notification of aforementioned foreign workers candidates to the Employers no later than 2 (two) working days with a copy submitted to the Directorate General of Immigration”.
According to this Presidential Regulation, the Employers shall pay compensation for the use of foreign workers after receiving notification. The compensation is paid via banks appointed by the Minister and is a Non-Tax State Revenue. The government agencies, representatives of foreign countries, and international agencies are excluded from paying the compensation.
Under this Presidential Regulation, every foreign worker in Indonesia is required to have a Limited Stay Visa (VITAS) for work, filed by the Employers or the Workers to the Minister in charge of Law and Human Rights or appointed officials, with attached notification and proof of payment.
“The application of Vitas as referred to may also be used as application for Limited Stay Permit (ITAS),” Article 20 paragraph (1) of this Presidential Regulation states.
In the event of application for both ITAS and VITAS, according to this Presidential Regulation, the process of requesting ITAS shall be conducted by representatives of the Republic of Indonesia abroad, which is an extension of the Directorate General of Immigration. ITAS is a residence permit to work for foreign workers and shall be issued at the Immigration checkpoint.
“The residence permit for foreign workers for the first time is given at the maximum 2 (two) years and may be extended in accordance with the provisions of this Law,” reads Article 21 paragraph (3) of this Presidential Regulation. The issuance of ITAS shall also be supplemented by the issuance of Re-entry Permit for several trips which has same validity period with ITAS.
Furthermore, Presidential Regulation stipulates that every employer shall be obliged to register foreign workers who work more than 6 months to Social Security Provider for Employment (BPJS Ketenagakerjaan) and/or to insurance in Indonesian insurance company.
This Presidential Regulation was enacted by Minister of Law and Human Rights, Yasonna H. Laoly, on March 29, 2018 and shall come into force 3 months after the date of promulgation. (FID/JAY/ES) (GWH-RI/EP/Naster)