In Indonesia, probation (masa percobaan) is not a flexible trial period—it is strictly governed by labor law. For foreign employers, misunderstanding these rules often leads to costly disputes.

By law, a probationary period is only valid under an indefinite-term contract (PKWTT) and may last no more than three months. It cannot be applied to fixed-term contracts (PKWT), and any clause attempting to do so is automatically void. After three months, the employee is deemed permanent if employment continues, with full protection under the Manpower Law.

A striking example is the case of PT Indosat vs. I Made Wirawan (Supreme Court Decision No. 1554 K/Pdt.Sus-PHI/2016). The employee was initially placed on a probation arrangement, but the company failed to clarify his contract type. After dismissal, he challenged his status in court. The judges ruled that because probation cannot exceed three months and was improperly applied, the worker must be recognized as a permanent employee with entitlement to severance. The employer, despite being a large multinational, was held accountable for misclassifying the employment relationship.

This case highlights a critical lesson: in Indonesia, probation is a legal instrument, not an employer’s discretion. Attempting to extend probation beyond three months—or to impose it on a PKWT employee—can backfire, resulting in the worker being declared permanent by law. Once that status is confirmed, termination requires strict procedures, including severance pay as stipulated in the Manpower Law and its amendments.

For foreign managers accustomed to six-month trials, this may seem restrictive. Yet, compliance is non-negotiable. Companies seeking longer evaluations should consider structured performance reviews or project-based fixed-term contracts, but never misuse probation. 

To avoid legal pitfalls and design compliant hiring strategies, consult our HR Specialist Urwah AlBarki (+62 815-1852-024).

References:

1. Law No. 13 of 2003 on Manpower, Articles 58 & 60.
   Source: BPK – UU No. 13/2003
2. Law No. 11 of 2020 (Omnibus Law) – Labor Provisions.
   Source: BPK – UU No. 11/2020
3. Government Regulation No. 35 of 2021 on Fixed-Term Contracts & Termination.
   Source: BPK – PP No. 35/2021

Supreme Court Decision No. 1554 K/Pdt.Sus-PHI/2016 (PT Indosat vs. I Made Wirawan) – on probation misuse.
Source: Mahkamah Agung RI Directory Putusan