Law Number 13 Year 2003 concerning Labor (“Labor Law”) hold companies responsible in the improvement of its labor’s competency through on the job trainings. Article 12(2) of the Labor Law mandated the Minister to regulate the details pertaining companies to be included in this obligation.

To facilitate the Labor Law, The Minister of Labor and Transmigration has recently issued Decision No. KEP.261/MEN/X/2004 on Companies that are Obligated to Provide On The Job Training (the “Decision”).

According to the Decision, the obligation to provide on the job training only applies to companies employing more than 100 employees. Such obligation shall be enforced as to cover at least 5% of the total number of employees in any 1-year period.

On the job training must be applied systematically to augment labor’s managerial or technical skills. The program may be conducted either internally or by an accredited training institution. Participants are to receive appropriate certification acknowledging that they have completed the requisite training modules to have successfully completed the program. The Decision states that “internship” program can also apply as on-the-job training program. (mma)