In Indonesia, employees are entitled to 12 days of paid annual leave per year after 12 months of continuous service under the Manpower Act (Undang-Undang Ketenagakerjaan). The leave is typically taken after the first year of employment, and unused leave may expire if not taken within the specified period.

Statutory entitlement

12 days of paid annual leave per year after 12 months of continuous service. Paid at the employee's regular salary.

Eligibility

Employees must have worked continuously for at least 12 months to be entitled to paid annual leave. For employees on fixed-term contracts (PKWT), leave is typically granted after the first year.

Employer obligations

  • Grant 12 days of paid annual leave per year to eligible employees.
  • Pay the employee's regular salary during annual leave.
  • Determine the annual leave schedule in consultation with the employee.
  • Pay for unused annual leave on termination of employment.
  • Maintain records of annual leave taken by each employee.

Employee rights

  • Right to 12 days of paid annual leave after 12 months of service.
  • Right to be paid at the regular salary during annual leave.
  • Right to agree on the timing of annual leave with the employer.
  • Right to paid leave payout on termination.

Common pitfalls

  • Not granting leave after 12 months — the entitlement begins after the first year of continuous service.
  • Not paying for unused leave on termination — this is required under PP 35/2021.
  • Not maintaining leave records — employers must keep accurate records of leave taken.

How annual leave accrues

Annual leave accrues after 12 months of continuous service. The employee is entitled to 12 days of paid leave per year. The employer and employee should agree on when the leave is taken.

Unused leave

Unused annual leave typically expires at the end of the leave year unless the employer's policy allows carry-over. On termination, unused leave must be paid out.

Fixed-term contract employees

Employees on fixed-term contracts (PKWT) are entitled to annual leave after 12 months of continuous service. If the contract is shorter than 12 months, leave is typically not accrued, but the employer may provide it voluntarily.

Frequently asked questions

Can annual leave be carried forward?

The Manpower Act does not specifically address carry-over. It depends on the employer's policy or company regulations.

Are contract workers entitled to annual leave?

Yes, after 12 months of continuous service. For contracts shorter than 12 months, leave is typically not accrued unless the employer provides it voluntarily.

What happens to unused leave on termination?

Under PP 35/2021, unused annual leave must be paid out on termination of employment.

Sources

This page is provided for general guidance and does not constitute legal advice. Always check the cited primary source for current law before making employment decisions.