---
title: "Indonesia PP 35/2021: Contracts, Overtime and Dismissal"
description: "PP 35/2021 governs fixed-term (PKWT) contracts, outsourcing, working hours, overtime, dismissal and severance. In force, read with Court ruling 168/2023."
lang: en
canonical: "https://kariraman.com/en/regulations/government-regulation-35-2021/"
datePublished: "2026-10-07"
dateModified: "2026-10-07"
sources:
  - "https://peraturan.go.id/files/pp35-2021bt.pdf"
  - "https://peraturan.go.id/files/uu-no-6-tahun-2023.pdf"
  - "https://s.mkri.id/public/content/persidangan/putusan/putusan_mkri_11215_1730375514.pdf"
  - "https://emedia.dpr.go.id/news/2026/10/07/dpr-sahkan-uu-pelindungan-ketenagakerjaan-dasco-kado-terindah-untuk-buruh"
  - "https://kemnaker.go.id/news/detail/menaker-ungkap-poin-penting-uu-pelindungan-ketenagakerjaan-yang-wajib-diketahui-pekerja"
  - "https://peraturan.go.id/files/pp36-2021bt.pdf"
---

> Markdown version of https://kariraman.com/en/regulations/government-regulation-35-2021/. Cite that HTML page and its update date.

# Government Regulation 35/2021 on fixed-term contracts, outsourcing, hours and dismissal

Written by KarirAman editorial team Approved by [Kaiser Khan](https://kariraman.com/en/authors/kaiser-khan/) (editor), 8 October 2026 Updated 7 October 2026

In force

PP 35/2021 governs fixed-term (PKWT) contracts, outsourcing, working hours, overtime, dismissal and severance. In force, read with Court ruling 168/2023.

## Summary

- PP 35/2021 was signed and promulgated on 2 February 2021 and is recorded as in force by the BPK legal database.
- A time-based fixed-term contract (PKWT) may last at most 5 years including extensions (Article 8).
- A PKWT cannot require a probation period; if it does, the probation clause is void by law (Article 12).
- Overtime is capped at 4 hours a day and 18 hours a week, and the hourly wage is 1/173 of the monthly wage (Articles 26 and 32).
- Since Constitutional Court ruling 168/PUU-XXI/2023, the severance tables are read as minimum amounts.

**Legal status:** the Labour Protection Law was approved by the DPR and the Government on 6 October 2026 but has not been promulgated and its text is not public. Until it takes effect, the rules on this page apply.

[Dewan Perwakilan Rakyat RI (emedia)](https://emedia.dpr.go.id/news/2026/10/07/dpr-sahkan-uu-pelindungan-ketenagakerjaan-dasco-kado-terindah-untuk-buruh) 7 October 2026; [Kementerian Ketenagakerjaan RI](https://kemnaker.go.id/news/detail/menaker-ungkap-poin-penting-uu-pelindungan-ketenagakerjaan-yang-wajib-diketahui-pekerja) 7 October 2026

- **Number:** PP No. 35 Tahun 2021
- **Type:** PP
- **Date:** 2 February 2021

[Official document (PDF)](https://peraturan.go.id/files/pp35-2021bt.pdf) [Official page](https://peraturan.go.id/id/pp-no-35-tahun-2021)

## What does PP 35/2021 cover?

Government Regulation 35/2021 on Fixed-Term Employment Contracts, Outsourcing, Working Time and Rest, and Termination of Employment (PP 35/2021) was signed and promulgated on 2 February 2021 (State Gazette 2021 No. 45). It implements the Job Creation (Cipta Kerja) law and covers five areas: fixed-term contracts (PKWT), outsourcing, working time and rest, overtime, and dismissal with severance. As of 7 October 2026, the BPK legal database records it as in force.

## Which articles matter for fixed-term contracts (PKWT)?

- A PKWT is based either on a time period or on the completion of a specific job, and may not be used for permanent work (Article 4).
- A time-based PKWT may last at most 5 years including extensions, and service counts from the start of employment (Article 8).
- Daily-paid contracts are only for work of fewer than 21 days a month; at 21 days or more for 3 consecutive months, the job becomes permanent (PKWTT) by law (Article 10).
- A PKWT may not require a probation period (Article 12).
- The employer must register the PKWT online with the Ministry of Manpower (Article 14).
- The employer must pay compensation when a PKWT ends to workers with at least 1 month of service (Articles 15 and 16), including when the contract is ended early (Article 17).

The full worker's guide is at [PKWT and PKWTT contracts](https://kariraman.com/en/workers-rights/pkwt-pkwtt-employment-contracts/).

## Which articles matter for working hours and overtime?

- Working time is 7 hours a day and 40 hours a week for a 6-day week, or 8 hours a day and 40 hours a week for a 5-day week (Article 21), with 1 or 2 rest days a week (Article 22).
- Overtime is capped at 4 hours a day and 18 hours a week, not counting overtime on rest days or public holidays (Article 26).
- Overtime requires the employer's instruction and the worker's written or digital consent (Article 28).
- Overtime of 4 hours or more requires food and drink of at least 1,400 kilocalories, which cannot be replaced with money (Article 29).
- Overtime pay on a working day is 1.5 times the hourly wage for the first hour and 2 times after that; on rest days and public holidays the multipliers are 2, 3 and 4 times (Article 31). The hourly wage is 1/173 of the monthly wage (Article 32).

How to calculate it: [Overtime pay](https://kariraman.com/en/workers-rights/overtime-pay/).

## Which articles matter for dismissal and severance?

- Article 36 lists the grounds for dismissal, from mergers and efficiency to resignation and retirement.
- The employer must give written notice of the intention and reasons at least 14 working days in advance (Article 37). A worker who disagrees must reply in writing with reasons within 7 working days, and the dispute then goes to bipartite negotiation and the industrial dispute procedure (Article 39).
- Article 40 sets the tables for severance pay (uang pesangon), long-service pay (UPMK) and compensation for rights (uang penggantian hak). Articles 41 to 57 set the multiplier for each dismissal ground.
- A worker who resigns in line with the conditions receives compensation for rights and separation pay (uang pisah) (Article 50).
- For micro and small businesses, the amounts are set by agreement (Article 59).

The tables and explanation are at [Severance pay and dismissal](https://kariraman.com/en/workers-rights/severance-pay-and-dismissal/).

## How does Constitutional Court ruling 168/PUU-XXI/2023 change the way PP 35/2021 is read?

Constitutional Court ruling 168/PUU-XXI/2023, delivered on 31 October 2024, changed how Law 13/2003 as amended by Law 6/2023, the parent law of PP 35/2021, must be read. The points that matter most to workers:

- a PKWT may last at most 5 years including extensions, and must be written in Indonesian and Latin script (rulings 4 and 5);
- weekly rest includes the option of 2 days for a 5-day week (ruling 7);
- if bipartite talks fail, dismissal may only happen after a final and binding decision of the industrial dispute body (ruling 20); and
- the severance table in Article 156(2) is read as a **minimum** , not a fixed amount (ruling 22).

## Will PP 35/2021 be replaced?

Probably, but not yet. The DPR and the Government approved the Labour Protection Law (UU Pelindungan Ketenagakerjaan) in a plenary session on 6 October 2026. It has no number yet, has not been promulgated, and its text is not public. Until the new law and its implementing regulations take effect, PP 35/2021 still applies. We track the changes at [Indonesia's new labour law](https://kariraman.com/en/workers-rights/new-labour-law/).

- **Kemnaker help centre and call centre** [1500630](tel:1500630) [bantuan.kemnaker.go.id](https://bantuan.kemnaker.go.id/)

Not legal advice. For your own case, contact the official channels listed.

## Frequently asked questions

**Is PP 35/2021 still in force?**

Yes. The BPK legal database records PP 35/2021 as in force. The DPR and the Government approved the Labour Protection Law on 6 October 2026, but it has not been promulgated. Until the new law and its implementing rules take effect, PP 35/2021 still applies.

**How long can a fixed-term contract (PKWT) be extended?**

A time-based PKWT may run for at most 5 years, and with extensions the total still may not exceed 5 years (PP 35/2021 Article 8). Constitutional Court ruling 168/PUU-XXI/2023 also confirms the 5-year maximum including extensions.

**Do contract workers get end-of-contract compensation?**

Yes. The employer must pay compensation (uang kompensasi) when a PKWT ends to workers with at least 1 month of continuous service (Article 15). It is based on length of service, and a 12-month contract equals 1 month's wage (Article 16).

## Who wrote and reviewed this page?

Written by KarirAman editorial team Published 7 October 2026 Updated 7 October 2026

Prepared with AI assistance. Checked against official sources and approved for publication by Kaiser Khan (editor). Approval date: 8 October 2026.

## Sources

The facts on this page come from these sources. Dates show when we opened them.

1. [Peraturan Pemerintah Nomor 35 Tahun 2021 tentang Perjanjian Kerja Waktu Tertentu, Alih Daya, Waktu Kerja dan Waktu Istirahat, dan Pemutusan Hubungan Kerja](https://peraturan.go.id/files/pp35-2021bt.pdf) Kementerian Hukum RI (peraturan.go.id) · PP 35/2021 · accessed 7 October 2026
2. [Undang-Undang Nomor 6 Tahun 2023 tentang Penetapan Perppu Nomor 2 Tahun 2022 tentang Cipta Kerja menjadi Undang-Undang](https://peraturan.go.id/files/uu-no-6-tahun-2023.pdf) Kementerian Hukum RI (peraturan.go.id) · UU 6/2023 · accessed 7 October 2026
3. [Putusan Mahkamah Konstitusi Nomor 168/PUU-XXI/2023 (pengujian UU 6/2023, klaster ketenagakerjaan)](https://s.mkri.id/public/content/persidangan/putusan/putusan_mkri_11215_1730375514.pdf) Mahkamah Konstitusi RI · accessed 7 October 2026
4. [DPR Sahkan UU Pelindungan Ketenagakerjaan (emedia DPR RI, 7 Oktober 2026)](https://emedia.dpr.go.id/news/2026/10/07/dpr-sahkan-uu-pelindungan-ketenagakerjaan-dasco-kado-terindah-untuk-buruh) Dewan Perwakilan Rakyat RI (emedia) · accessed 7 October 2026
5. [Menaker Ungkap Poin Penting UU Pelindungan Ketenagakerjaan yang Wajib Diketahui Pekerja](https://kemnaker.go.id/news/detail/menaker-ungkap-poin-penting-uu-pelindungan-ketenagakerjaan-yang-wajib-diketahui-pekerja) Kementerian Ketenagakerjaan RI · accessed 7 October 2026
6. [Peraturan Pemerintah Nomor 36 Tahun 2021 tentang Pengupahan](https://peraturan.go.id/files/pp36-2021bt.pdf) Kementerian Hukum RI (peraturan.go.id) · PP 36/2021 · accessed 7 October 2026

**How to cite**

KarirAman (2026). Government Regulation 35/2021 on fixed-term contracts, outsourcing, hours and dismissal. Updated 7 October 2026. https://kariraman.com/en/regulations/government-regulation-35-2021/

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## Related guides

- [**PKWT vs PKWTT: fixed-term and permanent employment contracts in Indonesia**](https://kariraman.com/en/workers-rights/pkwt-pkwtt-employment-contracts/)
- [**Overtime pay in Indonesia: hour limits, how to calculate it and your rights**](https://kariraman.com/en/workers-rights/overtime-pay/)
- [**Severance pay and dismissal in Indonesia: your rights, the tables and the lawful procedure**](https://kariraman.com/en/workers-rights/severance-pay-and-dismissal/)
- [**Indonesia's new labour law 2026: is it in force yet, and what does it mean for workers?**](https://kariraman.com/en/workers-rights/new-labour-law/)
- [**Manpower Regulation 6/2016 on the religious holiday allowance (THR)**](https://kariraman.com/en/regulations/manpower-regulation-6-2016-thr/)
- [**Workers' rights**](https://kariraman.com/en/workers-rights/)

- [Panduan Warga severance calculator](https://panduanwarga.org/en/calculators/severance-pay/)

CariTalent and PanduanHewan are Kode Nirlaba projects; Panduan Warga and The Cast Index are independent publications with the same founder. CourseToJob is a study-guide site with the same owner, run by Elite Digital AI Solutions Ltd.