if somebody has a 2 year contract but can earn double in another company can i enforce the contractr

### 1. Executive Summary / Quick Answer **Yes, you can legally enforce the financial remedies of the contract, but you cannot physically force the individual to remain employed.** Under Indonesian Law, a 2-year employment contract is classified as a Fixed-Term Employment Agreement (*Perjanjian Kerja Waktu Tertentu* / PKWT). While the Indonesian Constitution and labor laws prohibit forced labor, **Article 62 of Law No. 13 of 2003 on Manpower** explicitly entitles you (as the employer) to financial compensation if the employee resigns prior to the expiration of the 2-year term. Specifically, the employee is legally obligated to compensate you in an amount equal to their **wages for the remainder of the contract period**, unless the contract expressly provides otherwise or an amicable mutual settlement is reached. --- ### 2. Relevant Indonesian Legal Framework & Statutory Articles * **Indonesian Civil Code (*Kitab Undang-Undang Hukum Perdata* / KUHPerdata):** * **Article 1320:** Essential conditions for the validity of an agreement. * **Article 1338:** The principle of *pacta sunt servanda* (agreements validly entered into constitute law for the parties). * **Law No. 13 of 2003 on Manpower (*UU Ketenagakerjaan*), as amended by Law No. 6 of 2023 (*UU Cipta Kerja*):** * **Article 62:** Governs early unilateral termination of fixed-term contracts (PKWT). It stipulates that if either party terminates the employment relationship before the expiration of the period, the party initiating the termination must pay compensation to the other party equivalent to the worker’s salary up to the expiration date. * **Government Regulation No. 35 of 2021 (*PP 35/2021*):** * **Article 17:** Reaffirms that the party terminating a PKWT prematurely must pay compensation for the remaining term of the contract. --- ### 3. In-depth Legal Analysis & Rights of the Parties #### A. Specific Performance vs. Financial Damages * **No Forced Labor:** Under Indonesian public policy, you cannot petition an Industrial Relations Court (*Pengadilan Hubungan Industrial* / PHI) or civil court to compel an employee to physically report to work. * **Enforceability of Monetary Damages:** You have a statutory right to demand compensation for the unexpired duration of the contract. For example, if the employee leaves at month 6 of a 24-month contract, they (or their prospective employer via a buyout agreement) are liable to pay **18 months' worth of basic salary** to your company. #### B. Contractual Penalty Clauses (*Denda*) * If your employment agreement specifies a liquidated damages clause or a fixed buyout fee that differs from Article 62, Indonesian courts and bipartite negotiations generally uphold it, provided it is reasonable and was freely agreed upon under Article 1320 and 1338 of the KUHPerdata. * If specialized, documented training was provided, any accompanying "training bond" (*ikatan dinas*) is also enforceable as a separate contractual recovery claim. #### C. The New Employer’s Role * It is standard industry practice in Indonesia for an employee seeking a higher compensation package to negotiate a **"buyout"** with the prospective employer, wherein the new employer covers the contractual penalty owed to the previous company. #### D. Non-Compete Clauses * If you intend to prevent the employee from joining a competitor: Non-Compete Agreements are notoriously difficult to enforce in Indonesian courts because **Article 27(2) and 28D(2) of the 1945 Constitution** protect every citizen’s right to work and earn a livelihood. * However, if the employee misappropriates company trade secrets or confidential data to secure the new role, you may pursue legal action under **Law No. 30 of 2000 on Trade Secrets**. --- ### 4. Actionable Recommendations & Practical Steps 1. **Audit the Employment Contract:** * Examine the termination clause, notice period, and specific penalty/indemnity provisions. * Confirm whether the contract was properly reported/registered in the government portal (*Kemenaker*) as required by PP 35/2021. 2. **Calculate the Statutory Exposure:** * Determine the exact number of months remaining in the 2-year term. Multiply this by the employee’s regular monthly wage to determine your statutory claim amount under Article 62 of UU 13/2003. 3. **Initiate Bipartite Dialogue (*Musyawarah*):** * Schedule an exit interview/bipartite negotiation. * Present the employee with their legal liability under Article 62 of UU 13/2003. * Offer the employee the option to have their **new employer buy out the contract** or negotiate an exit settlement (*Perjanjian Bersama*). 4. **Issue a Formal Notice (*Somasi*) if Breach Occurs:** * If the employee leaves unilaterally without paying, issue a formal legal notice (*Somasi*) demanding the settlement of the remaining contract value. 5. **Execute a Mutual Termination Agreement (*Perjanjian Bersama* / PB):** * Once financial terms are agreed upon, formalize the exit via a *Perjanjian Bersama* and register it with the local Industrial Relations Court to prevent future claims. --- ### 5. Standard Legal Disclaimer *The guidance provided above is for educational and informational purposes based on prevailing Indonesian laws and regulations. It does not constitute a formal advocate-client relationship. Because labor dispute outcomes depend heavily on the specific wording of your employment agreement and corporate documentation, it is strongly advised to consult with a licensed Indonesian legal advocate before taking formal adverse action.*