PP 20/2018 on The Use of Foreign Workers

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Summary

This new regulation (PP 20/2018) is to deem invalid the previous Presidential Regulation (PP
72/2014) on the same topic. The two implementing regulations, MoM Regulation 35/2012
and its amendment (MoM Regulation 12/2013), are still valid, as long as their provisions are
NOT contradictory to the provisions set out in this new regulation.

Below is the summary of the contradictory points taken from the implementing
regulations, which, according to Article 38 of the current regulation, are deemed invalid.

• The new regulation provides greater clarity and simplification from previous
Presidential Regulation (PP 72/2014) and the relevant implementing regulations.

• The new regulation emphasizes the consideration of market condition in hiring
foreign worker, while under PP 72, such consideration is to be made only when
updating RPTKA.

• Under PP 72, technical recommendation was a requirement for RPTKA. While the
new regulation does not require one, it does say, “in case that the technical
ministries or agency requires competency or qualifications, or prohibit the use of
foreign worker for a specific position, those head of agencies or ministries are to
inform Minister of Manpower those requirements to be approved1” (Article 5).

• There is no more IMTA under the new regulation, but there is an added step (ie,
submission of foreign worker information) in the process, which is placed after
RPTKA is approved.

• Under the new regulation, RPTKA is the only formal document that will be issued by
the Ministry of Manpower, which, after being approved, has similar legal standing as
IMTA under the previous regulation (abolished under new regulation).

• It used to take 6 days in total (3 days for RPTKA and 3 days for IMTA) for a foreign
worker to be able to apply for VITAS/ITAS. Under the new regulation, it takes 4 days
for them to obtain approved RPTKA.

• Under the previous regulation, employer needs to report the implementation of the
use of foreign worker once in between 3-6 months. Under the new regulation, the
reporting is required to be done only once a year.

1 No further elaboration on the process, whether there is review before approval.

• Under the new regulation, RPTKA is not required anymore for the following three
types of employment:

o Shareholders who are members of board of commissioner, or executives,
diplomatic and consular staff, and foreign workers for other job types that are
required by the government.

• Foreign workers hired under emergency and/or urgent conditions: Now it is specified
that the RPTKA has to be submitted 2 days after the foreign workers started working,
while there was no specification regarding this in the previous regulation.

• Temporary positions: RPTKA was valid for a maximum of 6 months in the past, but
under the new regulation, it is valid for a maximum of 1 month.

• In the previous regulation, RPTKA was valid for a maximum of 5 years, and IMTA had
to be updated every 1-2 years. Under the new regulation, RPTKA is valid for the
duration of employment contract.

• Under the new regulation, RPTKA form is simplified. The only information required in
the form include the justification for hiring foreign worker, position to be filled,
duration of employment, and accompanying TKI. There is also simplification of
RPTKA required documents. Those no longer required include letter of domicile,
NPWP, and proof of compulsory reporting (bukti wajib lapor).

• Under the new regulation, employers are not required to update RPTKA when there
are changes in location, nationality, and total numbers of foreign workers, although
employers are still required to update RPTKA when there is an additional number of
foreign workers hired.

• Under the new regulation, foreign worker is allowed to be employed by other
employers, provided that it is for the same position and within the duration of the
contract of employment with the first employer.

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