Leave Policy in Indonesia

Types of Leave

Indonesia’s leave entitlements are governed primarily by Law No. 13 of 2003 on Manpower, with adjustments from the Omnibus Law (Law No. 11 of 2020). Employers must follow national labor requirements for each type of leave. Below is a breakdown of statutory entitlements:

• Annual Leave: Employees who have completed 12 consecutive months of service are entitled to 12 working days of paid annual leave per year. Annual leave must be taken within 6 months of becoming entitled unless otherwise agreed in writing. The employer is responsible for maintaining accurate leave records and ensuring leave is granted appropriately.
• Sick Leave: Employees are entitled to paid sick leave with medical certification. The payment structure is as follows: 100% salary for the first 4 months of illness, 75% for the next 4 months, 50% for the following 4 months, and 25% thereafter. Medical documentation is required, and employers must follow this tiered payment structure to stay compliant.
• Maternity Leave: Female employees are entitled to 3 months of fully paid maternity leave (1.5 months before and 1.5 months after childbirth). Employers must also allow additional unpaid leave in the event of medical complications related to pregnancy.
• Paternity Leave: Fathers are entitled to 2 days of paid leave in connection with the birth of a child, though companies may offer more based on internal policy.
• Menstrual Leave: Women are entitled to 2 days of menstrual leave per month, particularly on the first and second days of menstruation, if they are unable to work. While this is mandated by law, practical implementation may vary by company agreement.
• Special Leave: Employees are also entitled to additional leave for family or religious events including: marriage (3 days), marriage of a child (2 days), circumcision of a child (2 days), baptism (2 days), spouse’s death (2 days), and death of an immediate family member (1 day).

Unused Leave

Annual leave must be used within 6 months of becoming eligible. If not used, it may expire unless both parties agree to extend the period. Unused leave must be paid out in full upon termination, resignation, or retirement. Employers should maintain leave balances and encourage timely use to avoid compliance risks.

Consequences of Mismanagement

Employers that fail to comply with Indonesia’s leave regulations can face fines and labor audits. The Ministry of Manpower may issue warnings or administrative sanctions for failure to grant paid leave or underpayment of sick or maternity leave. Poor leave tracking can also result in disputes, employee dissatisfaction, and legal claims for back pay or damages.

Public Holidays

Indonesia typically recognizes 16–20 public holidays annually, depending on the lunar and Islamic calendar. Major holidays include Eid al-Fitr, Christmas, Islamic New Year, and Independence Day. Public holidays are announced annually by the government. Employees who work on a public holiday are entitled to double pay or compensatory time off. Employers should publish a clear holiday calendar each year.

How AYP Manages Leave Compliance

AYP supports businesses operating in Indonesia by managing leave accruals, ensuring proper salary deductions for long-term sick leave, tracking special leave entitlements, and handling public holiday compliance. We stay updated on national law and help employers adapt quickly to legislative changes under the Omnibus Law. With AYP’s Employer of Record services, you ensure your leave policies are compliant, automated, and transparent.

Contact Us

Interested in expanding your team in Indonesia? Contact AYP to simplify your hiring, payroll, and compliance responsibilities through our trusted Employer of Record platform.