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Employer of Record Indonesia

Overview

An Employer of Record (EOR) service allows international and domestic companies to hire employees in Indonesia without needing a client’s local legal entity. Business Hub Asia acts as the legal employer, handling all administrative, legal, and employment obligations. This enables clients to focus on their strategic growth while ensuring regulatory compliance and operational effectiveness.

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Key Features

Legal Employer Representation

We act as an official employer before the government and labor authorities, ensuring the entire process complies with Indonesian law.

Employee Recruitment & Onboarding

From employee search, selection, to placement, we do it professionally and tailor to your business needs.

Payroll & Tax Management

Calculation and payment of salaries, PPh 21, BPJS Health and Employment, as well as routine reporting to relevant agencies.

Employment Contract & Legal Documentation

Preparation of employment contracts following Indonesian labor law, both for permanent, contract and expatriate employees.

Employment Law Compliance

Ensure all employment activities comply with the Job Creation Law, Ministry of Labor Regulations, and other local regulations.

Risk Management & Legal Protection

Mitigate legal and administrative risks that may arise from direct employment relationships, including in cases of termination or disputes.

Minimum Requirements

Job & Headcount

Job description and number of employees required

Placement Details

Employee placement locations and details of work facilities

Compensation Policy

Salary policy, benefits, and desired work structure

Company Legality

Company legal documents (if applicable) for administrative cooperation

Common Eligible Sectors

This service can be used for almost all business sectors, especially for:

Foreign companies without local entities in Indonesia

Startups looking to test the market before full expansion

Technology and digital companies that employ remote workers

Consulting, finance, energy, and manufacturing companies

Short-term project businesses that need local manpower fast

Process and Timeline

1

Needs Analysis & Recruitment Strategy

Consultations with clients to determine staffing and organizational requirements, including creating a recruitment strategy with job specifications, required skills, and sourcing methods. Estimated Time: 3-5 working days.

2

Sourcing and Candidate Selection

Source candidates through job postings and searches, then screen CVs, conduct interviews, and administer competency tests to assess fit. Estimated Time: 10-14 working days.

3

Contract Development and Employee Onboarding

Draft and execute compliant employment contracts in Indonesia and manage employee onboarding.Estimated Time: 3-5 working days.

4

HR Management and Compliance

Manage employee administration, including payroll, tax, BPJS, and labor law compliance..

*Preparation of EOR services takes at least 3-5 weeks and is followed by ongoing HR and compliance management according to client needs.

Important Consideration

  • EOR is an ideal solution for foreign companies that want to operate quickly without forming a local PT, or in parallel of their company registration process. 
  • We ensure full transparency in salary management, tax, and legal compliance.
  • Employees will work directly under your direction, but their legal status is under our entity as EOR.
  • All processes follow the latest labor and taxation standards in Indonesia.

Frequently Asked Questions

What is an Employer of Record (EOR)?

An EOR is a third party that legally hires employees on behalf of your company, handling all legal, tax and administrative aspects of employment.

Is an EOR suitable for companies without an entity in Indonesia?

An Employer of Record (EOR) offers a practical approach for international companies seeking to employ local talent without establishing a formal business presence. This solution allows foreign businesses to build a local team without the complexities of entity setup.

How is the payroll and tax system managed?

We calculate and pay salaries, PPh 21, and BPJS contributions regularly, and deliver pay slips to employees every month.

Does EOR only apply to local employees?

No, we can also manage the placement of foreign workers (TKA) under Indonesian licensing and immigration regulations.

What are the risks of hiring employees without an EOR or local entity?

Businesses operating in Indonesia without a local entity face high legal risks, including potential fines, tax non-compliance, and labor disputes. An Employer of Record (EOR) is crucial for mitigating these risks.

Can I transfer employees from the EOR to my entity in the future?

Yes. We support the transition of employees to your company if you decide to set up a local entity in the future.

Streamline Your Human Resources and Payroll Processes

Focus on growing your team while we handle HR policies, employment contracts, payroll processing, and statutory obligations.

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