17
Jun2022
diplomatic

Employment Relationship Between Diplomatic Representatives and Local Employees in Indonesia

Diplomatic representatives are granted immunity and privileges in carrying out their duties and functions based on the 1961 Vienna Convention on Diplomatic Relations. Some immunities and privileges are  immunity in carrying out official duties and privileges in the form of exemption from contributions, taxes and customs duties as well as exemption from inspection of goods, social security, social services and military service of the receiving country.

The purpose of granting immunities and privileges to diplomatic representatives is not for individual interests or benefits, but to protect the interests of the sending country in the territory of the receiving country and the citizens it represents. In addition, the granting of such immunities and privileges to diplomatic representatives aims at encouraging the development of friendly, economic, cultural and scientific relations between the two countries.

In carrying out its functions in the receiving country, the diplomatic representative of the sending country does not only employ employees from their country. They commonly employ local employees  who are usually hired to work in sectors that are not directly related to the main diplomatic works. This refers to Article 8 paragraph 2 of the 1961 Vienna Convention which states that employees who work for diplomatic representatives are not entirely citizens of the sending country, but also locals in the receiving country.

Representatives of foreign countries in Indonesia, who employ locals, are considered “employer” based on Article 1 Point 4 of Law no. 13 of 2003 on Manpower, stating:

“Employer is an individual, entrepreneur, legal entity, or other entity that employs workers by paying wages or other forms of remuneration”

This is considered one of the basis that the diplomatic representatives have immunities and privileges that cannot be contested as well as the existence of a passive territorial principle that applies to diplomatic relations are not valid or invalidated in their employment relationships with local employees in Indonesia. In other words, diplomatic representatives who employ locals are employers who are obliged to comply with the applicable labor regulations in Indonesia.

In order to protect and provide legal certainty to local employees, the Supreme Court has issued the Circular Letter of the Supreme Court (SEMA) of Republic of Indonesia Number 4 of 2016 stating that the Industrial Relations Court has the competence to examine and decide on disputes in employment relations between local manpower/workers/employees/staff and representatives of foreign countries (Embassy, ​​Charge d’Affaires, and so on) in Indonesia because representatives of foreign countries are deemed employers based on Article 1 point 4 of the Manpower Law.  In short,  the provisions of the Manpower Law are applicable in the employment relationship involving local manpower/workers/employees/staff and representatives of foreign countries in Indonesia.

The Supreme Court has heard and issued a landmark decision related to a case involving a local employee and a representative of foreign countries.  The Indonesian Supreme Court Decision No. 376 K/Pdt.Sus-PHI/2013 upheld the Jakarta Industrial Court’s decision to sentence the Brazilian Embassy to Indonesia in Jakarta to pay Termination of Employment (Pemutusan Hubungan Kerja/PHK) compensation of nearly Rp 500 million to a former local staff member.

With these legal foundations, diplomatic representatives are expected to pay attention to the applicable legal provisions in Indonesia related to employment, such as the making of Employment Agreements, Internal Regulations, and Termination of Employment in order to minimize disputes with local workers in industrial relations.

 

Author / Contributor:

Asdel Fira, S.H., CHRP

Senior Associate

Contact:

Mail       : fira@siplawfirm.id

Phone    : +62-21 799 7973 / +62-21 799 7975

 

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