Can Foreign Workers Work Outside Their Sponsoring Company? The Guarantor Principle Explained

Many assume a foreign worker in Indonesia can work as flexibly as a local employee — taking on projects here and there, or even freelancing outside their main company. But does Indonesian law actually allow that?

A foreign worker (Tenaga Kerja Asing, or TKA) is a foreign national holding a visa for the purpose of working within Indonesian territory. The presence of TKA in Indonesia is driven by factors such as the need for foreign human resources with the skills and knowledge required to optimally manage Indonesia's natural resources, the presence of multinational companies bringing their own expert and managerial staff amid rising foreign investment, and international cooperation arrangements that facilitate TKA presence in Indonesia.

The presence of TKA in Indonesia carries legal exposure, given their status as foreign nationals within a state's sovereign territory. Understanding and complying with Indonesia's immigration and employment regulations is therefore essential to avoid administrative and criminal sanctions. Under Indonesian immigration law, a TKA requires a Limited Stay Visa (VITAS) and a Limited Stay Permit (ITAS) issued specifically for employment purposes. Under Article 106(1) of Law No. 6 of 2023 on Job Creation, an Indonesian visa is a written statement — manual or electronic — issued by an authorised official permitting travel to Indonesian territory and forming the basis for granting a stay permit.

One of four visa types under applicable regulation is the Limited Stay Visa (VITAS). Under Article 106(4)(a) of the Job Creation Law, a VITAS is held by a foreign national acting as a religious worker, expert, employee, researcher, student, investor, second-home holder, or their family, as well as a foreign national lawfully married to an Indonesian citizen (WNI), travelling to Indonesia to reside for a limited period. A VITAS can be converted into a KITAS (Limited Stay Permit Card) by the Directorate General of Immigration.

An application for a Limited Stay Permit (ITAS) must meet the requirements under Article 142(1) and (2)(b) of Government Regulation No. 40 of 2023 (the fourth amendment to PP No. 31 of 2013 implementing the Immigration Law), which provides that an ITAS application is submitted by the foreign national or their guarantor to the Head of the Immigration Office or the designated Immigration Official whose jurisdiction covers the foreign national's place of residence, including proof of guarantee from a guarantor or immigration sponsor among the required documents.

The guarantor's role and responsibility

Under Article 1(26) of Law No. 6 of 2011 on Immigration, a guarantor is a person or corporation responsible for a foreign national's presence and activity while in Indonesian territory. The guarantor's standing is set out in Article 63(1) and (2) of the Immigration Law: certain foreign nationals in Indonesia must have a guarantor responsible for their presence and activity throughout their stay, with an obligation to report any change in the foreign national's civil status, immigration status, or address.

A TKA's guarantor is generally the employer — a duly incorporated legal entity that employs the TKA — rather than an individual, under Article 3 in conjunction with Article 9 of Government Regulation No. 34 of 2021 on the Use of Foreign Workers. The purpose of requiring a guarantor is generally to ensure there is a party legally responsible for a foreign national's presence and activity in Indonesia, making it easier for the government to monitor foreign nationals' activity and ensuring that employed TKA hold proper permits and comply with applicable regulation.

A violation by a TKA in principle also reflects on the employer's responsibility as guarantor, given that the employer has failed to ensure the guarantee it provided is actually fulfilled. Violations typically arise where a sponsoring company fails to meet its legal responsibilities — such as employing a TKA without a VITAS and ITAS, employing a TKA who is already under another company's guarantee, employing a TKA in a position inconsistent with statutory requirements, or failing to carry out an Exit Permit Only (EPO) process for a foreign national no longer employed.

As a technical matter, a company is prohibited from employing a TKA who is currently under another company's guarantee. This is because the stay permit granted to a TKA is for work under their guarantor/sponsor's supervision — meaning a TKA is not permitted to engage in other activity inconsistent with their stay permit, such as working for a different employer or in a different position than stated in their permit, without going through a lawful permit-change procedure. An exception exists under Article 5 of PP No. 34 of 2021, which allows a TKA employer to employ a TKA already employed by another TKA employer for the same position as: (a) a director or commissioner, or (b) a TKA in the vocational education and training sector, the digital economy sector, or the oil and gas sector for cooperation contractors. Under Article 6(2) of PP No. 34 of 2021, where a TKA employer intends to employ a TKA already employed by another TKA employer, each employer must hold an approved Foreign Worker Utilisation Plan (RPTKA). Outside these specific conditions, a TKA is not permitted to work outside their sponsoring company or for more than one employer.

A breach of these provisions is sanctioned under Article 122 of Law No. 6 of 2011, which provides for imprisonment of up to five years and a fine of up to Rp500,000,000 (five hundred million rupiah) for any foreign national, or any person who allows or enables a foreign national, to deliberately misuse or engage in activity inconsistent with the purpose of their granted stay permit. A guarantor who breaches its obligations similarly faces criminal sanction — imprisonment of up to five years and a fine of up to Rp500,000,000 — under Article 118 of Law No. 6 of 2011.