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General Guidelines for Staff Salaries and Allowances

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Download a Salary Survey - published by the American Women's Association in November 2008
(sorry, we don't have anything newer than that)

Compensation Benefits - May be paid in addition to base salary, or included in the base salary:

Food allowance

In addition to salary some employers provide a food allowance, or will provide basic food items such as rice, sugar, tea, coffee and oil and supplement it with the food allowance. Some employers many choose to simply work this into the salary, so that the staff is responsible for their own food purchases. This method seems to work with fewer headaches and misunderstandings. Some employees make a distinction between “food allowance” and salary so in the case of termination the severance pay would be less as they would not have to include the food allowance.

Transportation

Transportation expenses for live out staff may be given in addition to the salary. The average given depends on distance, type of transportation and how many buses the servant has to take to and from your home.

Medical

Reimbursements for doctors or medicine are strictly up to you. It has been the general practice amongst most expatriate employers to reimburse some medical expenses for the staff member but not necessarily for his/her family members. A general guideline is a cap of the equivalent of 1 month's salary over  a one year period.

Trial period

If you choose to do so, let the potential employee know that he or she would initially work for a trial period of time, normally two to three months, after which both parties may decide if the arrangement is working out.

Pay periods

Staff are usually paid every two weeks. But once a month is accepted as well. Make sure arrangements are agreed upon and understood by both parties. Some staff prefer not to take their salary (or their full salary) until they want to go home to their village for the holiday period, so they are not tempted to spend their salary.

Overtime

If an employee works past normal hours, for example during a dinner party, paying overtime wages would be customary. This is also true for the Indonesian official public holidays. If a servant chooses to work during a public holiday, he or she should be compensated for this.

Vacation

Household staff are entitled to a 14 day vacation period each year. Staffnormally want to take this vacation over the Lebaran holiday period (see below). The timing and scheduling of this and any other vacation period that you choose to offer also depends upon your own personal schedule and needs, so this should be discussed and mutually agreed upon as well. This is especially important if Lebaran is just a few months away, even though they haven't been working for you for a year, they will still expect to take vacation over the holidays. The amount that is paid may be pro-rated from the total time taken.

Living arrangements

Decide which staff, if any, will live in or out. If live in, what kind of arrangements will you have for them? Will they share a room or have a private room?

Health checks

If you would like the employee to have a health checkup, this will be the responsibility of the employer to pay for it. In most cases this is probably not necessary unless you suspect there might be a health issue or if the person will be working in close proximity to your young children.  It is recommended the check up be provided through reliable doctors and laboratories and the prospective staff member be checked for hepatitis, tuberculosis and typhoid, or other communicable diseases prior to employment, especially if they will be handling food or caring for young children. If the checkup is done at International SOS, a copy of the results will be available to the person that paid for it as well as the patient. Staff members should not oppose to having this done as they may not be able to pay for it themselves, however should be curious about their health condition.

Uniforms

Some employers choose to provide either a uniform or a work clothing allowance for employees, with perhaps the exception of night guards. Ready made uniforms are available at Kem Chicks or Hero's. They are durable and come in a variety of colors and styles. Of course you may also choose to have them custom made.  It is recommended that uniforms be provided only after the trial period. Ask your staff member what type of clothing they feel more comfortable wearing. Not all people are comfortable wearing uniforms.

Loans

Loaning money to staff is NOT recommended. Should you decide to do so it is advised that you loan money:
  1. only after staff has worked satisfactorily for you for at least 6 months.
  2. that no more than 1 month's base salary be loaned at a time.
  3. that an agreed payback schedule is worked out in writing.
  4. that any previous loans have been repaid in full.

Lebaran/THR Bonus

It is a government regulation that all employers give a one month's salary bonus to household staff after one year's employment. This referred to as THR (tunjuangan hari raya). If your staff has been working for less than 12 months the bonus is usually pro-rated. This bonus is given to staff, at the latest, 2 weeks before Lebaran/Idul Fitri to be used for expenses relating to the holiday. The recommended time off for Idul Fitri is from 2 days to 2 weeks, depending on the distance needed to travel.

Lebaran (Idul Fitri) is the celebration at the end of the holy month of Ramadhan for those of the Moslem faith. This is a very special time for Indonesians where it is the custom to give gifts of money and clothing. Although it is called a bonus it is not only customary but, by law, all employees are entitled by law to receive the equivalent of a full month's salary as a yearly bonus at this time. The amount should be paid on the salary (not allowances) by the employer. If your company employs your household staff, they should pay the THR. Undoubtedly an additional amount paid by the family that the staff work for is also appreciated. This additional gift to help them celebrate the holidays go a long ways towards building goodwill.

Many domestic helpers choose this time to return to their villages to celebrate the holiday with family. The bonus is very important, as most Indonesians do not manage a savings account and use the bonus to cover holiday shopping and tickets home.

In the case of employing a Christian servant, you would compensate at the time of the Christmas holidays. But, ask when they would like to receive their yearly bonus, to be sure.

Household utensils

It is recommended that the employer supply the entire staff with their own eating, drinking and cooking utensils, as well as linens. This helps ensure the health and well being of the entire household.

Incidentals

Some expatriate employers choose to provide toiletries or used clothing for their household staff.

Starting Date

If all goes well, everyone should agree upon the starting date.

Probation period

If you choose to do so, let the potential employee know that he or she would initially work for a trial period of time, normally two to three months, after which both parties may decide if the arrangement is working out.

Severance Pay

It is standard practice to provide the equivalent of one month's salary for each full year of service to an employee when you leave the country and no longer require his or her services or in the event of termination, regardless of the reason for termination.

This article was compiled from information provided by the AWA, Colliers International and expat website volunteers.

 

Last updated February 3, 2014

Housing and schooling information for expats in Indonesia expatriate website for Indonesia Indonesian language translation of article

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