Get Ahead on How to Setup an Employment Agency or Recruitment Agency in Indonesia
Being one of the world’s largest marketplace with colossal workforce labours, Indonesia’s need for proper distribution of manpower is more important than ever. Therefore, with the search for new employees on an ever-increasing demand; starting up your recruitment agency in Indonesia the sooner is better. But do you know where and how to start an employment agency or a recruitment agency in Indonesia?
What Are Employment Agencies in Indonesia?
Employment agencies do more than just bridging the gap between job seekers and employers. Amongst the things that recruitment firms specialise in are as follows:
- Help clients to advertise their company to potential employees.
- Screen and filter potential candidates.
- Conduct interviews to see if the candidate is the right match for the job.
- Inform and educate the candidate regarding the company and its requirements.
- Process hiring requirements and permits for foreign workers.
- Draft and prepare employment contracts.
- Provide training and development of new hires and team leads.
An employment agency sources new opportunities from their clients’ companies and finds potential candidates whose goals are parallel to the company’s vision. Recruitment firms’ cost-effective services are getting more and more essential as it saves much of the employer’s time and energy, which allows them to focus on other core competencies in their organization.
What Are the Procedures in Starting an Employment Agency in Indonesia?
One key thing to always remember is to adhere to and respect the law enacted by the Ministry of Labour and Immigration. Employment agencies in Indonesia are regulated by Law No. 13 of 2003 for private companies looking to employ workers for businesses. Apart from that, you need to file permits for foreign workers, establish human resource (HR) policies and draft employment contracts, which necessitates an in-depth understanding of the Indonesian labour law. Not only that, but you will need to go through a company formation procedure under the prerequisites of the Indonesian Commercial Law.
Another thing to bear in mind is the recruitments, whether it involves a domestic or a foreign worker, is regulated under The Ministry of Manpower. Public recruitment agencies need to acquire the approval (SPP) by the appropriate ministry and private entities must have a license (SIUP-PJTKI). The regulations prescribe the procedure to obtain an SPP and a SIUP-PJTKI. On the other hand, private agencies seeking a SIUP-PJTKI need to pay capital of 375 million rupiahs for a general recruitment license and 200 million rupiahs for a domestic recruitment license.
What Are the Necessary Documents Needed?
Although Indonesia has an abundance of local workers, at times, the need for foreign workers is in demand as well. Being a recruitment firm, it is imperative that you are prepared and well versed with all the necessary documents for a smooth hiring process.
When you start an employment agency, there is a series of steps that you will have to take, starting from reserving your company’s name and submitting the company incorporation documents, which takes up to one and ten days, respectively. After getting the approval of the submitted documents, you can then start to draft the Articles of Association and consecutively obtain approval of the Ministry of Law and a registered address. This whole process will take at least two to four days. Moving on, you can now start your tax and (value-added tax) VAT registration. The procedure will take five days, where finally after that, you can start obtaining your business license and permanent license.
Now is the Time to Start Your Employment Agency
Besides being rich in natural resources and having a massive marketplace, Indonesia also has one of the biggest labour forces in the world. Over 66.5% of 225 million people in the country are in their prime years and are employable. Thus, setting up your own employment agency to assign the great workforce labour the sooner, is better.