Indonesian labor law is clear: every employer — including any business that uses outsourced, contract, or third-party workers — is required to register all workers under the national social security program. That means BPJS Ketenagakerjaan (workplace accident, death benefit, and pension) and BPJS Kesehatan (national health insurance). This is not optional, and it applies regardless of how the employment relationship is structured on paper.
For the hospitality sector in Bali, where outsourcing housekeeping, security, F&B, and maintenance staff is common practice, this creates a specific and underappreciated risk.
What the law actually requires
Under Law No. 24 of 2011 on the Social Security Administering Body (BPJS Law) and Government Regulation No. 84 of 2013, employers are required to register their employees within 30 days of the start of employment. Failure to do so exposes the employer — not just the outsourcing vendor — to administrative sanctions under the Manpower Law (UU No. 13 of 2003).
In practice, this means:
- Fines for each unregistered worker, applied per month of non-compliance
- Forced back-payment of unpaid BPJS contributions, including both the employer and employee portions
- Potential criminal liability for company directors in serious or repeated cases
- Administrative action by Disnaker (the regional Ministry of Manpower), which can include public notices, license suspension review, or referral to prosecutors
The foreign director and GM visa risk
For foreign-owned properties or those with a foreign GM or director holding a KITAS or KITAP work permit, the exposure is more acute. Non-compliance with Indonesian labor law is one of the documented grounds on which immigration and labor authorities have coordinated on administrative action. While deportation is a serious outcome reserved for egregious or repeated violations, the reputational and operational damage from even an investigation is significant for a luxury property.
How non-compliance typically starts
The pattern is consistent. A property engages an outsourcing vendor — often on price. The vendor, to maintain margins, registers staff informally, intermittently, or not at all. The property has no visibility into this and may not ask. Months or years pass.
An inspection is then triggered — by a disgruntled ex-employee filing a complaint with Disnaker, by a competitor who reports the property, by a routine regulatory sweep, or by a vendor dispute that surfaces in public records. The inspector arrives. Documentation is requested. The vendor cannot produce it, or the registrations turn out to be incomplete. The property is now part of an active labor compliance inquiry.
What full compliance actually looks like
A genuinely compliant outsourcing arrangement means:
- Every deployed worker is registered under both BPJS Ketenagakerjaan and BPJS Kesehatan before their first shift — not in arrears, not pending
- Monthly BPJS contribution payments are documented and current
- Employment contracts (PKWT for fixed-term or PKWTT for permanent) are properly executed and filed
- The outsourcing company, not the property, is the employer of record — and can prove it with documentation available for inspection at any time
If your current vendor cannot show you these documents on request, that is the risk profile your property is carrying right now.
How to protect your property
The simplest protection is selecting an outsourcing partner that treats BPJS registration as a pre-condition of deployment — not an administrative detail to catch up on later. Ask your current vendor for a complete BPJS registration list for all workers deployed at your property. Ask to see the most recent monthly payment receipts. If this is difficult to obtain, that tells you what you need to know.
SUKHA registers every deployed staff member — BPJS Ketenagakerjaan and BPJS Kesehatan — before their first shift at any client property. Full audit documentation is available to clients at any time. The legal obligation transfers to us. Your property is not the employer of record. We are.