Ideal Structure of a Company Regulation (Peraturan Perusahaan / PP)
Table of Contents
- Introduction
- Legal Background
- Validity and Coverage
- Employee Rights & Obligations
- Employer Rights & Obligations
- Working Hours and Overtime
- Compensation and Benefits
- Leave Entitlements
- Workplace Ethics & Discipline
- Grievance Procedure
- Termination and Resignation Rules
- Occupational Health & Safety
- Closing Clause
- Signatures & Legalization
- Attachments
1. Introduction
A Company Regulation (Peraturan Perusahaan / PP) serves as the rulebook for all employees in a company without a Collective Labor Agreement (PKB). It must align with UU No. 13/2003, UU Cipta Kerja, and PP No. 36/2021, and be legalized by the local Disnaker (Manpower Office).
2. Legal Background
Include references to:
- UU Ketenagakerjaan No. 13/2003
- UU No. 11/2020 (Omnibus Law)
- PP No. 36/2021
- Other relevant labor regulations
3. Validity and Coverage
- Scope of employees (who are bound by this PP)
- Effective period (2 years from legalization)
- Company name, address, business nature
4. Employee Rights & Obligations
- Right to fair compensation, leave, safe workplace
- Obligations to follow SOPs, company rules
- Use of company assets, confidentiality
5. Employer Rights & Obligations
- Right to direct, control, and evaluate performance
- Obligation to pay salary on time, provide tools, comply with labor law
- BPJS and employment social security responsibilities
6. Working Hours and Overtime
- Standard work hours (40 hrs/week)
- Shift-based or non-shift-based
- Overtime provisions
- Breaks and rest days
7. Compensation and Benefits
- Salary structure
- Allowances, bonuses
- BPJS Kesehatan & Ketenagakerjaan
- THR (Tunjangan Hari Raya)
8. Leave Entitlements
- Annual leave, sick leave, maternity/paternity leave
- Leave for religious events, family death, etc.
- Leave approval procedures
9. Workplace Ethics & Discipline
- Rules of conduct
- Disciplinary sanctions and procedures
- Alcohol, drug, or harassment-related clauses
- Levels of warning: verbal, written, suspension, termination
10. Grievance Procedure
- Step-by-step employee complaint channel
- Timeline for resolution
- Escalation to bipartite negotiation or mediation
11. Termination and Resignation Rules
- Procedures for resignation
- Termination due to misconduct or redundancy
- Legal rights upon termination (compensation, severance, etc.)
12. Occupational Health & Safety
- Employee and employer obligations
- Safety tools and training
- Reporting mechanism for incidents
13. Closing Clause
- Statement of mutual agreement
- Consequences of violation
- Update mechanism of the regulation
14. Signatures & Legalization
- Signed by HR or authorized management
- Optional: employee representatives
- Disnaker approval stamp with date and registration number
15. Attachments
- Organization chart
- Job classification list
- Sample forms: leave request, disciplinary form, etc.
- SOPs or other related regulations
A well-structured PP protects both employees and employers. It reduces ambiguity, fosters consistency, and ensures legal alignment with evolving labor laws. If your PP is outdated or not yet legalized, now is the right time to act before it becomes a liability.