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There are many reasons why to hire employees in Bali. For example, you might be looking for a cost-effective way to hire employees to serve your overseas customers. Or you have clients in Bali, and you certainly wish to help them by hiring local employees.
An Employer of Record is a service provider that enables you to hire employees without setting up an entity in Bali.
In this article, we will describe how to use an Employer of Record when hiring employees in Bali.
Benefits of using Employer of Record to hire employees in Bali
Comply with employment regulations in Bali
Indonesia and similarly Bali are infamous for their messy and constantly changing legal system. Including hiring policy procedures of employees in Bali. But, this is not a stress factor if you use Emerhub’s EoR service. We will take care of all the compliance and legal matters.
Emerhub will determine the suitable business classification, employment contracts and benefits under the employment regulations, accurate payroll and tax calculation. We can also inform you of all the things you need to know when hiring and managing your staff.
Lower costs to test the market in Bali
Employer of Record enables you to test your business idea in Bali. Especially with minor financial contributions and risk, in case your business model involves hiring Indonesian or foreign employees. Thus, there is no need to set up a company, take care of monthly and annual compliance and rent an actual or virtual office.
Besides setting up, shutting down a company in Indonesia involves expenses as well. Using an Employer of Record is more cost-efficient than setting up your company, especially if your primary purpose is to hire employees in Bali or test the market.
Hire and expand fast in Bali
Using the Employer of Record service instead of setting up a company will save you a lot of time and energy in hiring employees in Bali. Moreover, employees can start working immediately without the need to wait for the company registration, which depending on the business classification, can take from a few weeks up to months.
Using the Employer of Record allows you to kick off right away.
Focus on your core business
Employer of Record service will allow you to focus on your core business. Hence, you do not need to spend days to fulfill the monthly administrative and compliance obligations. Above all, Emerhub will take care of the administrative tasks and legalities of employment that leave you more time to focus on developing your business.
Hiring employees in Bali to set up remote operations
Bali is clearly becoming more and more popular among foreign companies to hire employees and expand their business. The main reasons are smaller wages compared to other provinces in Indonesia, availability of skilled talents with good English, and an option to relocate talents from different locations.
Denpasar, the capital city of Bali, is one of the rising urbanites in Indonesia next to Semarang and Makassar, as stated by Alpha JWC Ventures and Kearney. Similarly, it has a growing number of middle-class consumers and developing digital and logistical infrastructure, indicating promising growth opportunities for digital development.
Minimum wage comparison between Bali and the rest of Indonesia
The provincial minimum wage of hired employees in Bali is lower compared to Jakarta. In Jakarta, the minimum wage is IDR 4.276.349, while in Bali, it is IDR 2.493.523. The minimum wage is also lower than other metropolitans, such as Surabaya and Bandung, and rising urbanites such as Semarang.
| Denpasar | Semarang | Bandung | Surabaya | Jakarta |
| IDR 2.770.300 | IDR 2.810.025 | IDR 3.742.276 | IDR 4.300.479 | IDR 4.416.186 |
Even though the minimum wages are lower in Bali, finding skillful talents fluent in English is easy. In addition, according to EF’s English Proficiency Index 2019, Bali surpassed Jakarta as the province with the highest English proficiency in Indonesia.
Salary standards in Bali
Compared to western countries, Indonesia, particularly Bali, has a lower average salary. The table below further shows the comparison of the average job salaries per year in the technology sector in Singapore, Australia, and Indonesia, based on Salary Benchmark 2020 of Michael Page.
Overall, the yearly salary in Indonesia is up to 25% lower for a graphic designer, up to 33% lower for a digital marketing manager, and up to 27% lower for a software engineer compared to Singapore and Australia.
| Graphic Designer | Digital Marketing Manager | Software Engineer | |
| Indonesia | USD 14.322 | USD 31.171 | USD 21.061 |
| Singapore | USD 56.620 | USD 95.876 | USD 52.090 |
| Australia | USD 52.601 | USD 87.411 | USD 77.355 |
Hiring employees using Employer of Record is a great choice to set up remote operations in Bali. Given these facts on minimum wage and salary comparison.
Additional outsourcing services in Bali
Recruitment
We can find the perfect talents for your business expansion. We set interviews and do background checks before endorsing candidates to you for another interview. Afterward, we will extend a job offer to your selected candidate and hire on your behalf.
HR outsourcing in Bali
There is no HR hired in many smaller or starting businesses, and the management handles the HR matters. As often, it is not cost-efficient to hire a full-time HR. Nevertheless, Emerhub can provide you with this service. It involves answering questions out of the scope of work, such as leaves, cultural holidays, documents, and other subjects related to HR that you may not know.
Workspace or office
Depending on the number of employees you plan to hire, Emerhub can provide a working space for your employees in the Emerhub office. However, if the team is big or you prefer to have your own office, Emerhub can assist in signing the lease for your office. Namely, a foreign company is not allowed to hold a lease in Indonesia.
Invoicing service
In case you have customers in Indonesia, and you would like to invoice them in Indonesia, Emerhub can also provide you with an invoicing service. The entity that is formally the employer of your employees will issue an invoice and pay taxes from the income earned. Once this is done, the money will be transferred to you.
If your vendors feel more comfortable working with an Indonesian entity, we can also assist you with the payment of invoices to vendors or other service providers.
Using an Employer of Record in Bali is a great way to test the market and hire employees without the hassle of running a company. Contact our Bali office today at [email protected] and get started.
