Payroll in Indonesia runs in IDR on a monthly payroll cycle cycle, with statutory employer contributions and the religious holiday allowance (thr) is mandatory, equal to one month's salary and pro-rated under one year of service, paid ahead of the employee's major religious holiday. Gracemark operates it end-to-end, humans, not tickets.
Currency
IDR, Indonesian rupiah
Payroll cycle
Monthly payroll cycle
Working week
Normal hours are 40 per week, either 7 hours a day over 6 days or 8 hours a day over 5 days; overtime is capped at 4 hours a day and 18 hours a week and paid at statutory multipliers
Minimum wage
Minimum wages are set annually by province (UMP) and sometimes by regency or city (UMK), so the applicable figure depends on the work location
13th-month
The Religious Holiday Allowance (THR) is mandatory, equal to one month's salary and pro-rated under one year of service, paid ahead of the employee's major religious holiday
Employer cost
Employer BPJS Ketenagakerjaan and BPJS Kesehatan contributions commonly total around 10% to 11% or more of salary, varying by programme and risk category with caps on some components
Probation
Probation is capped at 3 months for permanent (PKWTT) employees and is not permitted for fixed-term (PKWT) contracts
Notice period
Termination requires cause; severance, tenure pay and compensation of rights are calculated by statutory formula under Government Regulation 35/2021 based on service and reason
Two ways to run payroll in Indonesia
Own-entity payroll
For long-term presence in Indonesia. Gracemark manages statutory filings, pay runs, and year-end reporting under your entity, with a named operator on South-Eastern Asia time.
EOR-run payroll
No entity in Indonesia? Employ and pay talent under Gracemark's local infrastructure via EOR, onboard in 2–3 weeks (eor), no local incorporation.
Compliance essentials in Indonesia
THR religious-holiday bonus (one month) is mandatory
Severance under the Omnibus Law can be substantial
BPJS health and employment social security are required
Provincial minimum wages vary widely
Large, young, fast-growing digital workforce
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