Considering:

• That the implementation of Article 65 subsection (5) Manpower Act No.13 Year 2003 needs the regulation concerning amendment and/ or supplement to the conditions required for handing over part of work implementation to another company;
• That it is necessary to stipulate it in Ministerial Decree.

In view of:

• Act No. 3 Year 1951 concerning The Statement of Labour Supervision Act Promulgation Year 1948 No. 23 of Republic of Indonesia for entire Indonesia (State Gazette of Republic of Indonesia Year 1951 No. 4);
• Manpower Act No. 13 Year 2003 ( State Gazette of Republic of Indonesia Year 2003 No. 39, Suplement to State Gazette of Republic of Indonesia No. 4279);
• The Decree of President of Republic of Indonesia No. 228/M Year 2001 concerning the Formation of “Gotong Royong” Cabinet.

Observing:

• The Main Ideas of Secretariat of National Tripartite Cooperation Institute on April 23, 2004;
• The agreement of plenary session of Kesepakatan National Tripartite Cooperation Institute on May 19, 2004.

DECIDE:

To stipulate:

THE DECREE OF MINISTER OF MANPOWER AND TRANSMIGRATION OF REPUBLIC OF INDONESIA CONCERNING THE CONDITIONS FOR HANDING OVER PART OF WORK IMPLEMENTATION TO ANOTHER COMPANY

Article 1

Under this Ministerial Decree, the following definitions shall apply:

• The company, hereinafter called as project owner:
• Every form of business, which is either a legal entity or not, which is owned by an individual, a partnership or a legal entity that is either privately owned or state owned, which employs workers/ labourers by paying them wages or other forms of remuneration;
• Social undertakings and other undertakings with officials in charge and which employ people by paying the wages or other forms of remuneration.
• Outsourcing service company is another company taking in charge in part of work handed over by the project owner company.
• Worker/ labourer is any one working for the outsourcing service company in charge in the project and receiving wage or other forms of remuneration.

Article 2

• Project owner company can hand over part of the work/ project to the outsourcing service company.
• The handing over of part of work/ project aforesaid in subsection (1) is implemented through the written outsourcing contract agreement .

Article 3

• Project owner company can hand over the work only to the outsourcing service company that has corporate body
• The stipulation on company with corporate body aforsaid in subsection (1) is excluding:
• Outsourcing service/ contractor company operating in goods supplying:
• Outsourcing service/ contractor company operating in mantainance and repair as well as consultant service in which the work employes less than 10 (ten) workers/ labourers.
• In condition that outsourcing service company aforesaid in subsection (1) will hand over the part of contracted work from project owner again to other company, it may be handed over to outsourcing service company that have no corporate body.
• In condition that outsourcing service company with no corporate body aforesaid in subsection (3) does not perform its obligation to fulfill the workers/ labourers’ right in employment relation, consequently, the outsourcing service company with corporate body aforesaid in subsection (1) is responsible for this obligation fulfilment.

Article 4

• In condition that there is no outsourcing service company with corporate body or there is outsourcing service company with corporate body but it is not qualified to conduct part of project owner company’s work, therefore, part of work may handed over by project owner to outsourcing service company that does not have corporate body.
• The outsourcing service company without corporate body aforesaid in subsection (1) is responsible for the labourers/ workers’ rights in the employment relationship between the outsourcing service company without corporate body and its labourers/ workers.
• Responsibility aforesaid in subsection (2) shall be stated in the outsorcing contract agreement between project owner and outsourcing service company.

Article 5

The outsorcing contract agreement shall mention the provisions guaranting the fulfillment of workers/ labourers’ rights in the employment relationship as stipulated in prevailing provisions/ regulations.

Article 6

• Type of work/ project which can be handed over to outsourcing service company aforesaid in Article 2 subsection (1) shall match the following conditions:
• The work is conducted separately from the core activities in management as well as in work implementation;
• The work is conducted with direct or indirect instruction from the project owner company to explain the work procedure in accordance with standard set by project owner company;
• The work is supporting activities for the all company activities, in other words, this activity is supporting or suplementary activity to the work activities based on the system applied in the project owner company.
• The work does not resist the production process dirrectly or the activity is supplementary activity in which if it is not conducted by the project owner company, work process is still running well.
• The project owner company that hand over part of its work to outsourcing service company is obliged to make process system concerning the work implementation.
• Based on the system aforesaid in subsection (2), the project owner company stipulates types of core work and supplementary work based on subsection (1) as well as reporting to the local manpower authority.

Article 7

• Project owner company, that has handed over the part of work to outsourcing company prior to the promulgation of this Ministerial Decree, shall go on implementing the outsourcing agreement with outsourcing service company as mutually agreed until the end of contract.
• In condition that outsourcing contract aforesaid in subsection (1) comes to end, further contract shall be in accordance with this Ministerial Decree.

Article 8

This decree comes into effect, starting from the date of its promulgation

Article 9

This Ministrial Decree shall be effective upon the date of its promulgation