Making Your First Hire: The Work That Comes Before Recruitment

First in a series on hiring, written for founders and decision makers in foreign-owned and domestic Indonesian companies. The sections on diagnosing the shortage, designing the role and delegating recruitment apply in any jurisdiction. Everything on cost, wages and contract form is Indonesian law and does not travel. Statutory positions are stated as at 18 August 2026 and are scheduled for review after 31 October 2026, the date by which the Constitutional Court required a separate Manpower Law.

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Of 548,605 companies newly incorporated in Canada between 2003 and 2015, between 10 and 16 per cent employed anyone in their opening year, falling to 7 or 8 per cent in the second year and 2 per cent by the fourth. Over 65 per cent of the 2003 cohort had employed nobody at all by 2017. Those figures come from Innovation, Science and Economic Development Canada, working from tax-linked administrative records covering the full population of incorporations.²² The dataset is Canadian and no Indonesian equivalent has been located.

Indonesia adds a second dimension. Statistics Indonesia recorded 146.54 million people in work in August 2025,²³ and reported separately that the proportion in formal employment rose from 42.05 per cent in August 2024 to 42.20 per cent in August 2025.²⁴ The remaining 57.80 per cent worked informally. Where your first employee comes from that majority, employing them brings registrations, contributions, protections and statutory entitlements that were not previously in place.

Diagnosing the Shortage

A shortage of hours describes a business with customers, with work waiting, and with lower-value tasks occupying the founder’s week. Demand is the shortage where the hours are available and the work has not been won. The third situation, common in professional services, is a shortage of capability, in which the work exists and requires a skill the founder does not have. An assistant addresses a shortage of hours and does nothing for a shortage of demand or of capability.

The fortnight audit

We call this the fortnight audit and we run it with clients before any role is opened. Write down everything you did across the preceding fortnight and mark each item into one of four columns.

• Column A, work that generated revenue directly, such as billable delivery, selling, or negotiating a contract.
• Column B, work that enabled revenue without generating it, such as proposals, scheduling, supplier management or invoicing.
• Column C, work that somebody paid a fraction of your rate could have done to the same standard.
• Column D, work that produced no result you would repeat.

Total the hours in each column, then read them together. Heavy B and C beside a thin A indicates a shortage of hours, and an assistant recovers those hours at the lowest cost. A heavy A that produced little revenue indicates a shortage of demand, and the first employee is someone who wins work. An A column filled with work you completed slowly and outside your competence indicates a shortage of capability, and the first employee is a specialist. A heavy D column indicates work to be stopped before anyone is employed to inherit it.

Most weeks fill every column. Where two shortages appear together, rank them by the revenue at stake rather than by the hours, since hours are recoverable and lost work is not. Then put a price on the hours. Divide the revenue you generated in column A by the hours in column A to get an hourly value for your own time, multiply that by the hours columns B and C would release, and compare the result against the annual cost of the role given in the costing table. Where the released hours do not cover that cost, the role is premature at that salary.

The fortnight audit is a diagnostic for your own use and does not substitute for advice on your position. Where it points to employing someone, the contract form, the wage level and the registration obligations depend on your company’s activity, its location, its risk classification and the status of the person engaged, and we confirm those against your own records before anything is drafted.

Designing the Role Before Recruiting For It

A seat that defeats person after person has been designed wrongly, and no amount of care in selection corrects it. Our own finance function demonstrated the point over six years and eight or nine finance managers. We treated each departure as a recruitment problem and selected each replacement more carefully than the one before, and the outcome repeated.

What resolved the position was redesign rather than recruitment. The role took every client’s finance work, every escalation and every unresolved problem into one place, and displaced the incumbent’s other responsibilities whenever any of it arrived. We withdrew it and created an internal finance lead whose scope is the company’s own accounts and controls, with client-facing finance work distributed to the teams that own those clients. The seat stopped producing departures. Tracy’s assessment is that moving too slowly on the earlier exits damaged our reputation to a greater degree than the departures themselves did.

Where one of those questions has no answer, what has been written down is a description of the founder’s own overload. The fifth question saves a salary, and we apply it before any budget is approved. Where a team is above capacity, we recruit only once we have established that the process cannot be streamlined enough to reduce the load, and that nothing further can be delegated within the team. Our billing system records every client-facing and internal task against the client and the team, so a team’s hours can be set against the fees that work produced and a capacity claim tested rather than accepted.

Where recruitment does go wrong, the international estimate of replacement cost is lower than the figures in general circulation. Heather Boushey and Sarah Jane Glynn reviewed 30 case studies across 11 research papers for the Center for American Progress in 2012, drawn from United States data published between 1992 and 2007. They found a typical replacement cost near 20 per cent of annual salary, 16 per cent for jobs paying under USD 30,000, and a full observed range from 5.8 per cent to 213 per cent, the upper end covering executives and physicians. Only two of the eleven papers included indirect costs, so the authors treat the central figure as an understatement.²⁶ In Indonesia the exit cost is set by statute instead of estimated.

Costing a First Employee in Indonesia

Employer contributions, the religious holiday allowance and minimum leave are set by regulation and are not open to negotiation between the parties.

Element	Position
Health cover	5 per cent of monthly wage in total, being 4 per cent from the employer and 1 per cent from the employee. The contribution base has a ceiling of IDR 12,000,000 a month and is subject to a lower limit of the applicable provincial or regency minimum wage12
Old age security	5.7 per cent of monthly wage in total, being 3.70 per cent from the employer and 2 per cent from the employee3
Pension	3 per cent of monthly wage in total, being 2 per cent from the employer and 1 per cent from the employee. The contribution base has a ceiling of IDR 11,086,300 a month with effect from 1 March 2026, adjusted annually by the previous year’s gross domestic product growth4
Work accident cover	0.24 per cent of monthly wage at the lowest of five risk bands, rising through 0.54, 0.89 and 1.27 to 1.74 per cent at the highest. Paid by the employer, with no employee share5
Death cover	0.30 per cent of monthly wage, with no employee share5
Religious holiday allowance	One month of wage at twelve months of service, pro-rated below that, in cash and in full no later than seven days before the holiday. Payment by instalment is prohibited6
Annual leave	At least twelve working days once twelve months of continuous service are complete78
Long leave	Permissive rather than mandatory since the 2023 amendment. A company may grant it through the employment agreement, company regulations or a collective agreement78

For an office position in the lowest work accident risk band, employer contributions total 10.24 per cent of wage, being 4 plus 3.70 plus 2 plus 0.24 plus 0.30. That figure applies while the wage is below both contribution ceilings. Above a ceiling the employer’s contribution for that programme stops rising, so the percentage falls as the wage rises and the multiplier below overstates the cost.

Two worked examples

Both use the 2026 Badung regency minimum wage as the base and convert at the Bank Indonesia transaction middle rate of IDR 17,836 to USD 1 on 18 August 2026.

Item	Junior administrator at minimum wage	Finance manager at IDR 15,000,000
Monthly wage	IDR 3,791,003 (approximately USD 213)	IDR 15,000,000 (approximately USD 841)
Employer contributions, monthly	IDR 388,199, being 10.24 per cent, since the wage is below both ceilings	IDR 1,337,726, being 4 per cent of the IDR 12,000,000 health ceiling, 3.70 per cent of full wage, 2 per cent of the IDR 11,086,300 pension ceiling, and 0.54 per cent of full wage for accident and death cover
Effective employer load	10.24 per cent of wage	8.92 per cent of wage
Annual wage, thirteen payments including the religious holiday allowance	IDR 49,283,033 (approximately USD 2,763)	IDR 195,000,000 (approximately USD 10,933)
Annual employer contributions	IDR 4,658,388	IDR 16,052,712
Total annual cost before any exit payment	IDR 53,941,417 (approximately USD 3,024), being 1.19 times twelve months of wage	IDR 211,052,712 (approximately USD 11,833), being 1.17 times twelve months of wage

The commonly quoted multiplier of 1.20 to 1.25 times salary applies at or near the minimum wage and overstates the cost of a senior first hire.

Which minimum wage applies

Indonesia sets minimum wages provincially and by regency or city, so the applicable figure depends on where the employee works. In Bali for 2026, four of the nine regencies and cities have their own decreed rate and the remaining five take the provincial rate.

Area	2026 monthly minimum wage	Approximate USD equivalent
Badung	IDR 3,791,002.57	USD 213
Denpasar	IDR 3,499,878.78	USD 196
Gianyar	IDR 3,316,798.48	USD 186
Tabanan	IDR 3,287,678.87	USD 184
Buleleng, Karangasem, Klungkung, Bangli and Jembrana	IDR 3,207,459.00, being the provincial rate	USD 180

Both sets of rates were decreed in December 2025 and took effect on 1 January 2026.⁹¹⁰ Sectoral rates run above these for specified activities, including IDR 3,267,693.00 provincially and IDR 3,828,912.60 in Badung for four and five star accommodation and its food and beverage operations. USD equivalents use the rate and date given above and move daily.

Employer duties created by employing somebody

• Registration with both social security administrators. BPJS Kesehatan and BPJS Ketenagakerjaan are two separate bodies, and each takes its own registration. The employer registers itself and its workers.¹¹ Failure runs through written warnings to a fine of 0.1 per cent a month of the contributions due, and to the withdrawal of certain public services.¹²
• Monthly income tax withholding applies from the first payslip. Employee income tax is deducted, paid by the fifteenth of the following month and reported by the twentieth.¹³ A company’s annual return follows within four months of the end of the tax year.
• The company manpower report, Wajib Lapor Ketenagakerjaan di Perusahaan, filed through the Online Single Submission system.¹⁴¹⁵
• Registration of a fixed-term agreement with the manpower ministry, dealt with under the contract form.

Choosing the Contract Form

A probation period is permitted only within an indefinite-term agreement, where it may not exceed three months and the employee must receive at least the applicable minimum wage throughout. The Job Creation Law of 2023 left that provision untouched, and it remains in its original form.⁷⁸

A fixed-term agreement may not include probation. A probation requirement in one is void by operation of law, and the period counts as service.⁷¹⁶ The employer who chose the fixed-term form to limit exposure is left with an employee who has accrued service and no trial period.

The fixed-term form imports drafting and filing requirements that an at-will jurisdiction does not impose.

• It must be in writing, in Indonesian and in Latin script. Where a bilingual version differs, the Indonesian text prevails.⁷⁸
• It must be registered by the employer with the manpower ministry online within three working days of signature, or in writing at the regency or city manpower office within seven working days where online lodgement is unavailable. The administrative sanctions provision of the governing regulation does not list this duty, so no penalty attaches to late registration under that instrument.¹⁶
• Its total term including extensions may not exceed five years, and service is counted from the start of the original agreement.¹⁶
• It must record the minimum contents the regulation prescribes for a fixed-term agreement.¹⁶

The two forms end differently. A fixed-term agreement obliges the employer to pay compensation when the term ends, calculated at one month of wage for twelve months of continuous service and pro rata below that, and the same calculation applies where either party ends the engagement early.¹⁶ An indefinite-term agreement brings severance, long service pay and compensation of rights on a statutory schedule that varies by ground and by length of service, which is the heavier exposure of the two at any material tenure.

Pending change, stated 18 August 2026. The Constitutional Court ruled on 31 October 2024 that the legislature must enact a separate Manpower Law within two years, giving a deadline of 31 October 2026.¹⁷ As at mid-August 2026 the draft was at working-committee stage in the House of Representatives, and union confederations submitted a counter-draft on 3 August 2026 seeking a one-year cap on fixed-term agreements and the abolition of worker outsourcing. A five-year fixed-term structure agreed this quarter may therefore be governed by a different rule within months. Our advice to clients is to keep a first engagement short, and to weigh the heavier statutory exit of the indefinite form against the risk that the fixed-term rules change, on the facts of the particular engagement rather than as a general rule.

Delegating Recruitment

Within our own company each team recruits its own members, at the point and in the manner that team requires, on Tracy’s reasoning that the founder is not the person who knows what a given team needs. She delegates the selection entirely and keeps two things: approving the budget for an additional salary, and testing the revenue assumption beneath it. A founder who delegates the first hire and then selects every subsequent one personally has rebuilt the constraint one position further back.

A structured interview asks the same questions in the same order of every candidate and scores the answers against rating scales with defined descriptions at each point. Paul Sackett, Charlene Zhang, Christopher Berry and Filip Lievens revised the validity estimates behind selection practice in the Journal of Applied Psychology in 2022, having found the earlier figures over-corrected for range restriction.²⁷ On the revised estimates a structured interview reaches an operational validity of .42, a figure expressing how strongly the method predicts later job performance on a scale where 0 is no predictive power and 1 is perfect prediction, ahead of job knowledge tests at .40, work sample tests at .33 and general cognitive ability at .31. In-Sue Oh, Huy Le and Philip Roth published a methodological objection in the same journal in 2023, disputing the size of the revision, and Sackett and colleagues replied in the same issue.²⁸ Our reading is that the objection concerns the magnitude and does not displace the ordering of the methods, and that reading is ours rather than the authors’.

Nathan Kuncel, David Klieger, Brian Connelly and Deniz Ones compared mechanical and clinical data combination across 25 samples drawn from 17 studies, in the Journal of Applied Psychology in 2013.²⁹ Scoring candidates independently and combining those scores by formula predicted job performance at .44, against .28 where the same assessments were combined holistically by expert judgement, an improvement in prediction the authors put above 50 per cent. Our own practice had been independent scoring followed by discussion, on the view that the reasons behind each score reveal what the numbers alone cannot. That evidence supports the independent scoring and contradicts the conclusion we drew from it, so we changed the method: scores are recorded and locked before anyone speaks, the discussion is treated as information gathering, and a dimension is re-scored independently only where the discussion produced information nobody else had.

How TraceWorthy Helps

Our work on a first hire begins before a role is opened. We run the fortnight audit alongside a founder, read the four columns together, and price the hours a role would release against what it would cost across a full year. Where the released hours do not cover that cost, we say the role is premature at that salary, and we say what would have to change for the answer to differ.

We then put the five design questions to the role with the team that will work beside the person. Where a question has no answer, that is the work, since a role nobody can describe at three months produces the same recruitment cycle a second time. We apply inside our own company the rule we apply to a client’s: a new person is recruited once it has been established that the process cannot be streamlined enough to reduce the load, and not before.

The Indonesian execution follows from there. We set the wage position against the decree that applies in the regency where the employee will work, which in Bali is a difference of roughly IDR 583,500 a month, approximately USD 33, between the Badung rate and the provincial rate. We choose the contract form against what the company will need in three years instead of what feels safest this quarter, draft the agreement in Indonesian, register it inside the three working days the regulation allows, complete both social security registrations, and put the religious holiday allowance into the cash flow forecast before the month it falls due.

Where a company is already employing people, we look backwards as well as forwards. An agreement that was never registered, an English-only fixed-term contract, a wage set against the wrong regency, a probation clause in an agreement that cannot include one, and an employee who was never enrolled with either social security administrator are all correctable positions. Each of them costs less to correct before an inspection or a dispute than after one.

Sometimes the work turns out to be something other than a hiring problem, and we say so. A fortnight audit with a heavy fourth column points at work to stop rather than work to delegate. A thin first column with hours to spare points at a business that has not sold enough, where an assistant adds a fixed monthly cost against income the business has not yet earned. We would rather decline the engagement than staff a role that should not exist.

Get in touch if you are close to employing your first person in Indonesia, if you are already employing people under agreements that were never registered, if you are weighing a fixed-term structure that would run past the Manpower Law deadline of 31 October 2026, or if the role you have in mind is one a foreign national would fill.

Send us the role, the regency the person would work in, and the wage you had in mind. We will come back with the wage position that applies there, the contract form we would use and why, the registrations that follow, the annual cost across thirteen payments, and any exit exposure the form creates.

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This article is general information on employing a first person in Indonesia and is not individual legal, tax, employment or immigration advice, and it is not advice on the law of any other jurisdiction. Your position depends on your company’s contract form, its wage level, its location, its activity, its risk classification and the status of any foreign national engaged. We confirm the position for a client against that client’s own records before any engagement letter, employment agreement, registration or filing is prepared.

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Frequently Asked Questions

Should my first hire be a personal assistant or someone who brings in revenue?

It depends which of three shortages applies. An assistant returns the most usable hours for the cost where customers and work exist and administration occupies the week. Someone who wins work is the answer where the hours are available and the work has not been won. A specialist is the answer where the work requires a skill you do not have. Run the fortnight audit, then price the released hours against the annual cost of the role before deciding.

Can I put my first employee on probation in Indonesia?

Only under an indefinite-term agreement, where probation may not exceed three months and the employee must receive at least the applicable minimum wage throughout. A fixed-term agreement may not include probation, and a probation requirement in one is void by operation of law with the period counted as service. The fixed-term rules are among those the new Manpower Law may alter before 31 October 2026.

What does a first employee cost me across a year?

At or near the minimum wage, approximately 1.19 times twelve months of wage before any exit payment, once employer contributions and the religious holiday allowance are counted. At IDR 15,000,000 a month the multiplier falls to approximately 1.17, because the health and pension contribution bases are capped. The worked examples above give both. Exit payments are additional and depend on the contract form.

Which minimum wage applies to my employee?

The rate for the regency or city where the employee works, which in Bali for 2026 means that Badung, Denpasar, Gianyar and Tabanan each have their own decreed rate while Buleleng, Karangasem, Klungkung, Bangli and Jembrana take the provincial rate of IDR 3,207,459.00, with sectoral rates running above these for specified activities.

How do I know whether I have designed a role or written down my own overload?

Put the five design questions to the role. Where you cannot name the specific tasks delegated, cannot say what happens when the person is away for a fortnight, cannot state which decisions they take alone, cannot describe observable good performance at three months, and cannot say what would make the role unnecessary, what you have is a description of your own overload.

When should I stop making hiring decisions myself?

Once a team exists that understands its own work better than you do. Keep the budget approval and the revenue test, and delegate selection to the people who will work alongside the person, using the same questions asked in the same order of every candidate, independent scoring recorded and locked before any discussion, and a decision formed from those recorded scores.

Does any of this change if my company is foreign-owned?

The obligations set out in this article apply on the same terms to a foreign-owned and a domestic company. A foreign-owned company has further duties that a domestic company does not. It files a quarterly investment activity report through the Online Single Submission system, in the window from the first to the tenth of the month following each quarter, with sanctions running from written warning to revocation of the business licence. Where it engages a foreign national it pays a compensation fee of USD 100 per position per person per month, and it must appoint an Indonesian companion worker, with directors, commissioners, heads of representative offices and temporary assignments exempt. Seventeen positions are closed to foreign nationals by ministerial decree, covering the human resources function almost in its entirety, including personnel director, personnel manager and industrial relations manager. Employing a foreign national in the human resources function is therefore unlawful regardless of the company’s ownership. That subject has an instalment of its own in this series.

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Glossary

Term	Abbreviation	Explanation
Perjanjian Kerja Waktu Tertentu	PKWT	Fixed-term employment agreement. Limited to five years including extensions, unable to include a probation period, required to be in Indonesian and registered online within three working days of signature, and triggering a compensation payment when the term ends or where either party ends it early.
Perjanjian Kerja Waktu Tidak Tertentu	PKWTT	Indefinite-term employment agreement. The only form in which a probation period of up to three months is permitted, and the form that brings severance, long service pay and compensation of rights on ending.
Badan Penyelenggara Jaminan Sosial Kesehatan	BPJS Kesehatan	The health social security administrator. A separate body from the employment administrator, with its own registration.
Badan Penyelenggara Jaminan Sosial Ketenagakerjaan	BPJS Ketenagakerjaan	The employment social security administrator, running work accident, old age, pension and death cover. A separate body from the health administrator, with its own registration.
Tunjangan Hari Raya	THR	Religious holiday allowance of one month’s wage at twelve months of service, pro-rated below that, in cash and in full no later than seven days before the holiday.
Upah Minimum Kabupaten/Kota	UMK	The regency or city minimum wage, which applies in place of the provincial rate where one has been decreed for that area.
Batal demi hukum	None	Void by operation of law. The clause has no legal effect from the outset, without any party having to challenge it, and the position is treated as though the clause had never been written.

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Legal References

Statutory positions are stated as at 18 August 2026. Indonesian instruments are published in Indonesian only, and each is linked to the text published by the ministry that issued it.

¹ Presidential Regulation Number 82 of 2018 concerning Health Insurance
(Peraturan Presiden Nomor 82 Tahun 2018 tentang Jaminan Kesehatan)
Article 30(1) for the contribution rate, and article 32 for the ceiling and the lower limit.

² Presidential Regulation Number 59 of 2024 concerning the Third Amendment to Presidential Regulation Number 82 of 2018 concerning Health Insurance
(Peraturan Presiden Nomor 59 Tahun 2024 tentang Perubahan Ketiga atas Peraturan Presiden Nomor 82 Tahun 2018 tentang Jaminan Kesehatan)
The instrument by which article 32 was replaced.

³ Government Regulation Number 46 of 2015 concerning the Administration of the Old Age Security Programme
(Peraturan Pemerintah Nomor 46 Tahun 2015 tentang Penyelenggaraan Program Jaminan Hari Tua)
Article 16(1).

⁴ Government Regulation Number 45 of 2015 concerning the Administration of the Pension Security Programme
(Peraturan Pemerintah Nomor 45 Tahun 2015 tentang Penyelenggaraan Program Jaminan Pensiun)
Articles 28 and 29. The 2026 contribution ceiling of IDR 11,086,300 was set by BPJS Ketenagakerjaan letter B/1226/022026 of 25 February 2026, which is not published as a public instrument.

⁵ Government Regulation Number 44 of 2015 concerning the Administration of the Work Accident Security and Death Security Programmes
(Peraturan Pemerintah Nomor 44 Tahun 2015 tentang Penyelenggaraan Program Jaminan Kecelakaan Kerja dan Jaminan Kematian)
Article 16(1) for the five risk bands, and article 18(1) for death cover.

⁶ Regulation of the Minister of Manpower Number 6 of 2016 concerning the Religious Holiday Allowance for Workers at Companies
(Peraturan Menteri Ketenagakerjaan Nomor 6 Tahun 2016 tentang Tunjangan Hari Raya Keagamaan bagi Pekerja/Buruh di Perusahaan)
The annual position is confirmed by ministerial circular, most recently on 2 March 2026.

⁷ Law Number 13 of 2003 concerning Manpower
(Undang-Undang Nomor 13 Tahun 2003 tentang Ketenagakerjaan)
Article 57(1) on language and script; article 58 on probation in a fixed-term agreement; article 60 on probation in an indefinite-term agreement; article 79(3) on annual leave and article 79(5) on long leave. Article 60 was not amended in 2023.

⁸ Law Number 6 of 2023 concerning the Enactment of Government Regulation in Lieu of Law Number 2 of 2022 concerning Job Creation into Law
(Undang-Undang Nomor 6 Tahun 2023 tentang Penetapan Peraturan Pemerintah Pengganti Undang-Undang Nomor 2 Tahun 2022 tentang Cipta Kerja Menjadi Undang-Undang)
The instrument by which articles 57(1), 58 and 79 of Law Number 13 of 2003 were amended.

⁹ Decree of the Governor of Bali Number 1011/03-M/HK/2025 of 19 December 2025, on the Bali provincial minimum wage and provincial sectoral minimum wage for 2026
(Keputusan Gubernur Bali Nomor 1011/03-M/HK/2025 tentang Upah Minimum Provinsi dan Upah Minimum Sektoral Provinsi Tahun 2026)
Effective 1 January 2026.

¹⁰ Decree of the Governor of Bali Number 1021/03-M/HK/2025 of 23 December 2025, on the regency and city minimum wages and sectoral minimum wages for 2026
(Keputusan Gubernur Bali Nomor 1021/03-M/HK/2025 tentang Upah Minimum Kota/Kabupaten dan Upah Minimum Sektoral Kota/Kabupaten Tahun 2026)
Effective 1 January 2026.

¹¹ Law Number 24 of 2011 concerning the Social Security Administering Bodies
(Undang-Undang Nomor 24 Tahun 2011 tentang Badan Penyelenggara Jaminan Sosial)
Articles 5 and 6 establish the two separate bodies. Article 15(1) imposes the duty to register the employer and its workers. Article 1(9) defines an employer to include an individual, so an unincorporated employer is inside the duty.

¹² Government Regulation Number 86 of 2013 concerning Procedures for the Imposition of Administrative Sanctions in the Administration of Social Security
(Peraturan Pemerintah Nomor 86 Tahun 2013 tentang Tata Cara Pengenaan Sanksi Administratif kepada Pemberi Kerja Selain Penyelenggara Negara dan Setiap Orang, Selain Pemberi Kerja, Pekerja, dan Penerima Bantuan Iuran dalam Penyelenggaraan Jaminan Sosial)
The source of the written warning, the fine of 0.1 per cent a month, and the withdrawal of certain public services.

¹³ Regulation of the Minister of Finance Number 81 of 2024 concerning Taxation Provisions for the Implementation of the Core Tax Administration System
(Peraturan Menteri Keuangan Nomor 81 Tahun 2024 tentang Ketentuan Perpajakan dalam Rangka Pelaksanaan Sistem Inti Administrasi Perpajakan)
Article 94, for payment by the fifteenth and reporting by the twentieth of the following month.

¹⁴ Law Number 7 of 1981 concerning Compulsory Manpower Reporting at Companies
(Undang-Undang Nomor 7 Tahun 1981 tentang Wajib Lapor Ketenagakerjaan di Perusahaan)

¹⁵ Regulation of the Minister of Manpower Number 4 of 2019 concerning the Amendment to Regulation of the Minister of Manpower Number 18 of 2017 concerning Procedures for Online Compulsory Manpower Reporting at Companies
(Peraturan Menteri Ketenagakerjaan Nomor 4 Tahun 2019 tentang Perubahan atas Peraturan Menteri Ketenagakerjaan Nomor 18 Tahun 2017 tentang Tata Cara Wajib Lapor Ketenagakerjaan di Perusahaan Dalam Jaringan)
Article 5A(1), which directs the report through the Online Single Submission system.

¹⁶ Government Regulation Number 35 of 2021 concerning Fixed-Term Employment Agreements, Outsourcing, Working Time and Rest Time, and Termination of Employment
(Peraturan Pemerintah Nomor 35 Tahun 2021 tentang Perjanjian Kerja Waktu Tertentu, Alih Daya, Waktu Kerja dan Waktu Istirahat, dan Pemutusan Hubungan Kerja)
Article 8 on the five-year cap; article 12 on void probation; article 13 on minimum contents; article 14(1) on online registration within three working days and article 14(2) on written lodgement within seven; articles 15, 16 and 17 on compensation, its calculation, and early ending. Article 61 lists the administrative sanctions and does not include the registration duty.

¹⁷ Constitutional Court Decision Number 168/PUU-XXI/2023, decided 31 October 2024
(Putusan Mahkamah Konstitusi Nomor 168/PUU-XXI/2023)
The decision date is confirmed in the Court’s own published summary.

¹⁸ Regulation of the Minister of Investment and Downstream Industry, Head of the Investment Coordinating Board, Number 5 of 2025 concerning Guidelines and Procedures for Risk-Based Business Licensing and Investment Facilities through the Electronically Integrated Business Licensing System
(Peraturan Menteri Investasi dan Hilirisasi/Kepala Badan Koordinasi Penanaman Modal Nomor 5 Tahun 2025 tentang Pedoman dan Tata Cara Penyelenggaraan Perizinan Berusaha Berbasis Risiko dan Fasilitas Penanaman Modal Melalui Sistem Perizinan Berusaha Terintegrasi Secara Elektronik (Online Single Submission))
The source of the quarterly investment activity report and its filing window.

¹⁹ Regulation of the Minister of Manpower Number 8 of 2021 concerning the Implementing Regulation of Government Regulation Number 34 of 2021 concerning the Use of Foreign Workers
(Peraturan Menteri Ketenagakerjaan Nomor 8 Tahun 2021 tentang Peraturan Pelaksanaan Peraturan Pemerintah Nomor 34 Tahun 2021 tentang Penggunaan Tenaga Kerja Asing)
Article 35(1), for the compensation fee of USD 100 per position per person per month.

²⁰ Government Regulation Number 34 of 2021 concerning the Use of Foreign Workers
(Peraturan Pemerintah Nomor 34 Tahun 2021 tentang Penggunaan Tenaga Kerja Asing)
Article 7(1) on the Indonesian companion worker, and article 7(3) on the exemptions.

²¹ Decree of the Minister of Manpower Number 349 of 2019 concerning Certain Positions Closed to Foreign Workers
(Keputusan Menteri Ketenagakerjaan Nomor 349 Tahun 2019 tentang Jabatan Tertentu yang Dilarang Diduduki oleh Tenaga Kerja Asing)
The seventeen closed positions, covering the human resources function.

Research and Data Sources

²² Innovation, Science and Economic Development Canada, “From startup to employer: a duration analysis of the time until Canadian startups hire their first employee”, 10 December 2024
Drawn from the Canadian Employer-Employee Dynamics Database, covering the full population of incorporations.

²³ Statistics Indonesia, press release of 5 November 2025
The source of the figure of 146.54 million people in work in August 2025.

²⁴ Statistics Indonesia, news release of 5 November 2025
The source of the formal employment proportion of 42.20 per cent in August 2025, against 42.05 per cent a year earlier.

²⁵ Melba J. Duncan, “The Case for Executive Assistants”, Harvard Business Review, May 2011
The author heads an executive assistant search business, and the 8 per cent productivity figure has no empirical test behind it.

²⁶ Heather Boushey and Sarah Jane Glynn, “There Are Significant Business Costs to Replacing Employees”, Center for American Progress, 16 November 2012
Thirty case studies across eleven research papers, drawn from United States data published between 1992 and 2007.

²⁷ Paul R. Sackett, Charlene Zhang, Christopher M. Berry and Filip Lievens, “Revisiting meta-analytic estimates of validity in personnel selection: Addressing systematic overcorrection for restriction of range”, Journal of Applied Psychology, 2022, 107(11), 2040 to 2068

²⁸ In-Sue Oh, Huy Le and Philip L. Roth, “Revisiting Sackett et al.’s (2022) rationale behind their recommendation against correcting for range restriction in concurrent validation studies”, Journal of Applied Psychology, 2023, 108(8), 1300 to 1310
The reply by Sackett, Berry, Lievens and Zhang appears in the same issue at pages 1311 to 1315, at doi.org/10.1037/apl0001116.

²⁹ Nathan R. Kuncel, David M. Klieger, Brian S. Connelly and Deniz S. Ones, “Mechanical versus clinical data combination in selection and admissions decisions: A meta-analysis”, Journal of Applied Psychology, 2013, 98(6), 1060 to 1072
The figures of .44 and .28 are the job performance criterion, across 25 samples drawn from 17 studies.

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