When foreign companies expand into Bali, hiring is often the first step before incorporation. It’s how many of them test operations, manage projects on-site, or prepare for a full PT PMA setup.
The catch is that Indonesia’s labor laws don’t allow foreign entities to employ local staff directly. Every salary paid or contract signed without a registered entity falls outside of compliance and will expose you to penalties and permanent establishment risks.
However, you don’t have to wait for company registration to start hiring in Bali. Through an Employer of Record (EOR), you can onboard employees, run payroll, and stay fully compliant while your business structure is still in progress.
This guide explains how to start hiring in Bali without setting up a local company, the risks of doing it informally, and how an EOR helps you stay compliant as you build and manage your team.
Why Foreign Companies Hire in Bali
A. Cost Advantages Compared to Western Markets
Bali's workforce offers significant cost savings without sacrificing quality. Software developers here typically cost 40-50% less than their Silicon Valley counterparts, while working in similar time zones to Australian and Asian markets.
A mid-level full-stack developer, for instance, commands IDR 15-25 million monthly (USD 950-1,560), compared to USD 8,000+ for equivalent US talent.
And for the most part, the quality gap has narrowed significantly. Many Bali-based developers have worked with international startups and understand agile methodologies, CI/CD pipelines, and modern frameworks.
If we look beyond that, virtual assistants and administrative support roles deliver even better value. Experienced VAs who can handle everything from calendar management to basic bookkeeping cost IDR 6-10 million (USD 375-625) monthly.
Compare this to USD 3,000-4,000 for similar support in Western markets, and the economics become compelling, especially for startups and small businesses watching their burn rates.
B. Access to Specialized Talent Pools
Bali has evolved beyond its tourism-dependent economy to host specific talent clusters that serve international businesses. The island's digital nomad community has created an ecosystem of tech professionals who understand remote work culture and Western business practices. Unlike hiring from other Southeast Asian countries, many Bali-based professionals already work on Western schedules and communicate in fluent English.
The creative industry particularly thrives here. Video editors, graphic designers, and content creators often have experience working with international brands, understanding both technical requirements and cultural nuances. Social media managers trained in Bali's competitive tourism market know how to create engaging content and drive conversions – skills directly transferable to other industries.
Additionally, digital marketing specialists are another strong category. The island's dependence on online tourism marketing has created a pool of SEO specialists, performance marketers, and content strategists who understand international markets. These professionals often cost 60-70% less than Western equivalents while delivering comparable results.
C. Lifestyle Destination Attracting Quality Professionals
Bali's appeal as a lifestyle destination generally works in employers' favor. Talented Indonesians from Jakarta, Surabaya, and other major cities increasingly choose Bali for quality of life, creating a competitive talent market. These professionals often have corporate experience from Indonesia's business centers but prefer Bali's environment, making them ideal for remote positions.
The island also attracts international talent on long-term visas who can legally work for Indonesian entities or through EOR arrangements. This includes experienced professionals taking career breaks, digital nomads with specialized skills, and expats with regional expertise. While you can't directly employ foreign nationals without work permits, EOR services can facilitate these arrangements compliantly.
Commonly Outsourced Roles and Their Real Costs
The figures below reflect average monthly salaries (in IDR and USD) for some of the most in-demand positions in Bali’s remote and hybrid workforce today. This provides a realistic overview of what you can expect to pay, before factoring in statutory benefits and optional allowances.
1. Technical Roles:
- Junior Developer: IDR 8-12 million/month (USD 500-750)
- Senior Developer: IDR 20-30 million/month (USD 1,250-1,875)
- UI/UX Designer: IDR 10-18 million/month (USD 625-1,125)
- QA Tester: IDR 6-10 million/month (USD 375-625)
2. Operations and Support:
- Virtual Assistant: IDR 6-10 million/month (USD 375-625)
- Customer Support: IDR 5-8 million/month (USD 312-500)
- Bookkeeper: IDR 7-12 million/month (USD 437-750)
- Project Coordinator: IDR 10-15 million/month (USD 625-937)
3. Creative and Marketing:
- Content Writer: IDR 7-12 million/month (USD 437-750)
- Social Media Manager: IDR 8-15 million/month (USD 500-937)
- Video Editor: IDR 10-18 million/month (USD 625-1,125)
- Graphic Designer: IDR 8-14 million/month (USD 500-875)
Keep in mind that these figures reflect only base salaries. Once you factor in mandatory benefits such as BPJS, paid leave, and THR, your total cost usually rises by 20–25%, depending on the role and experience level.
Interested in real-time benchmarks and on-the-ground hiring insights? Emerhub’s local team in Bali can help you assess these considerations tailored to your industry.
Key Considerations When Hiring in Bali for Remote Operations
Mandatory Employee Benefits for Remote Teams in Bali
Under Indonesian labor law, employees are entitled to a set of statutory benefits. These apply even if the role is remote, must be outlined clearly in the employment contract and fulfilled consistently to stay compliant:
- BPJS Kesehatan (National Health Insurance): Covers outpatient care, hospitalization, and maternity services. Employers are required to register employees and contribute a percentage of monthly salary.
- BPJS Ketenagakerjaan (Workers’ Social Security): Includes four key protections–
- Work accident insurance (JKK)
- Death benefits (JKM)
- Old age savings (JHT)
- Pension fund (JP)
- Work accident insurance (JKK)
- Death benefits (JKM)
- Old age savings (JHT)
- Pension fund (JP)
- Tunjangan Hari Raya (THR– Religious Holiday Bonus): Equivalent to one month’s salary, this is paid annually before major religious holidays (e.g., Idul Fitri). Required for permanent and fixed-term employees with at least one month of service.
- Paid Leave: Employees are entitled to a minimum of 12 days of annual leave after one year of service, plus public holidays. Sick leave, maternity leave (3 months), and other statutory leaves must also be honored.
- Long-Service Award (Ulang Penghargaan Masa Kerja): This mandatory payout rewards employees with 3 or more years of service. The monetary compensation starts at 2x the employee’s monthly salary, scaling up to 10x for longer tenures.
Hidden Costs and Cultural Considerations for Remote Teams in Bali
Hiring in Bali often comes with soft costs and cultural expectations that aren’t always written into law but can have a real impact on employee retention and how well your team integrates into your operations.
Here are a few important considerations you should keep in mind:
- Unspoken Allowances: While not required by law, it’s common for local employers to offer additional stipends to stay competitive. These add roughly 10–15% on top of base pay, still a small fraction of Western overheads:
- Internet or data stipends: IDR 200,000–500,000 per month, especially for home-based staff.
- Transport or coworking allowance: IDR 300,000 – 800,000 per month for employees commuting or using shared offices.
- WFH allowance: One-time equipment or chair/laptop subsidies averaging IDR 3–5 million.
- Internet or data stipends: IDR 200,000–500,000 per month, especially for home-based staff.
- Transport or coworking allowance: IDR 300,000 – 800,000 per month for employees commuting or using shared offices.
- WFH allowance: One-time equipment or chair/laptop subsidies averaging IDR 3–5 million.
- Ceremonial and Religious Leave: Balinese employees may request time off for traditional ceremonies such as Ngaben (cremation rites), Galungan, or Nyepi. These events carry deep cultural importance even if they’re not listed as public holidays. Planning for such absences helps maintain goodwill and continuity among your local team, especially if you’re based outside major urban areas.
- Remote Readiness and Work Style: While many candidates are fluent in English and familiar with global tools, remote communication norms and preferences can still be different from what you’re used to.
- Quick updates are often shared via WhatsApp, not email or Slack, and feedback is typically delivered with care to avoid confrontation.
- This doesn’t mean local hires lack initiative. It means clarity and context are valued over directness. Setting clear communication norms and check-in routines early on will keep your projects running smoothly.
- Quick updates are often shared via WhatsApp, not email or Slack, and feedback is typically delivered with care to avoid confrontation.
- This doesn’t mean local hires lack initiative. It means clarity and context are valued over directness. Setting clear communication norms and check-in routines early on will keep your projects running smoothly.
💡 Budgeting only for base salaries often leads to turnover and misaligned expectations. It’s crucial to keep in mind that factors such as cultural sensitivities, informal allowances, and communication habits meaningfully shape your employee retention in Bali.
Understanding Your Hiring Limitations When You Don’t Have a Local Entity
Indonesia’s national labor and tax regulations are designed around the assumption that employers are legally registered within the country. For foreign businesses without a local entity, this creates specific risks and limitations when it comes to hiring. Here’s what you need to know before hiring anyone in Bali under your foreign company name:
- No legal standing without a local entity: Indonesia doesn’t recognize employment contracts issued by overseas companies. That means if a dispute arises over unpaid wages, wrongful termination, or contract breach, the local Manpower Office cannot acknowledge your company as the employer. In practice, this strips you of any enforceable rights while the employee retains the right to pursue compensation under Indonesian labor law.
- Risk of Permanent Establishment (PE): Employing or managing staff in Indonesia, even remotely, can meet the threshold for Permanent Establishment (PE) under Indonesian tax law. Even a handful of long-term remote hires can meet the threshold if they perform revenue-generating work for your company. Once identified, you’ll be liable for:
- Corporate income tax up to 22% on locally sourced income
- Late filing penalties (2% monthly interest up to 24 months)
- Backdated audits from the Directorate General of Taxes (DJP)
- Payroll and Tax Violations: Direct payments from overseas accounts are treated as personal remittances, not payroll. This bypasses mandatory withholdings like BPJS (social security and health insurance) and PPh 21 (income tax). If uncovered, both employer and employee may face tax arrears, frozen accounts, or fines up to 200% of the underpaid tax for non-compliance.
Emerhub’s local experts help bridge these compliance gaps before they escalate. We can assess your overall hiring setup, flag potential risks, and connect you with fully compliant solutions in Bali.
Hiring in Bali Without a Local Entity? Here Are Your Two Options
While you cannot legally place employees on payroll without a local entity, two compliant workarounds that are especially popular among foreign employers in Bali today:
- Working with freelancers or independent contractors under project-based contracts.
- Or partnering with an Employer of Record (EOR) who acts as your team's legal employer on your behalf.
Freelance and Contractor Employment in Bali
Freelancers and independent contractors are a practical choice for short-term or project-based work, particularly in creative, marketing, or technical roles. However, they’re not a sustainable option if your goal is to build a long-term, full-time team in Bali.
Most skilled professionals on the island today, especially those with international or remote experience, now prefer formal employment. They value structure, benefits, and continuity. Because of that, relying solely on freelance arrangements can make it harder to attract and retain strong candidates and can blur your accountability over time.
From a compliance standpoint, freelance contracts also come with limits. Once a contractor begins contributing full-time or comes under your direct supervision, they’re effectively treated as an employee under Indonesian labor law. This exposes your company to Permanent Establishment and employee misclassification risks, leading to backdated taxes and costly penalties.
Essentially, freelance arrangements still have their place, but only when the work is clearly scoped, temporary, and deliverable-based. For roles that require consistent output or integration with your core team, it’s far safer to formalize employment through a licensed Employer of Record (EOR).
How an Employer of Record (EOR) Helps You Hire in Bali Without a Local Entity
An Employer of Record (EOR) offers a compliant and efficient way to hire in Bali, protect your business, and retain your local talent.
At its core, the EOR acts as your team’s legal employer in Bali, handling employment contracts, payroll processing, tax filings, and BPJS registration on your behalf. You stay focused on managing your team’s daily work, performance, and goals, while the EOR ensures every employment and payroll process meets Indonesian labor standards.
It’s especially useful when you want to:
- Hire quickly while your PT PMA registration is still in progress.
- Formalize existing freelancers under compliant employment contracts.
- Test the market before committing to full incorporation.
Emerhub serves as your licensed EOR partner to facilitate these arrangements in Bali. Our advisors can map out the most efficient setup to help you get started, whether you’re building a remote team or scaling existing operations.
Fill out the form below to get in touch with our on-the-ground experts!
Frequently asked questions
1. What’s the easiest way to hire employees in Bali when you are still in the process of company setup?
If you don't plan to register a company in Bali or are still undergoing approval processes for your company, the fastest and most compliant way to begin hiring is through an Employer of Record (EOR). An EOR acts as the legal employer on your behalf, taking care of employment contracts, payroll, taxes, and benefits, while you manage the employee’s daily responsibilities. This allows you to: Test the Bali market or build a distributed team in Bali Hire your Bali team without setting up a legal entity Onboard remote or local staff quickly
2. How much does it cost to hire employees in Bali, and what’s the average minimum wage in the region?
Minimum wage rates in Bali set the legal baseline for entry-level and blue-collar positions, but they’re not what most skilled professionals earn. The government updates these rates each year under Government Regulation No. 51 of 2023, based on the Job Creation Law (Law No. 6 of 2023). Here’s an overview of the main regional benchmarks: These rates typically apply to roles like office assistants, retail staff, or entry-level admin positions. In contrast, mid- and senior-level professionals, such as developers, designers, and marketers, as discussed in the above article, command significantly higher pay, especially those already equipped for remote or international work setups. If you’d like a clearer estimate based on the current market rates and the type of role you're hiring for, our experts can help you run the numbers.
3. What benefits are legally required for employees in Bali, and can an EOR handle them on my behalf?
When you hire through an EOR, they’ll manage all mandatory employee benefits under Indonesian labor law are managed for you. This includes: You can also include optional benefits like wellness stipends, internet allowances, or co-working reimbursements to stay competitive. With an EOR, these are all administered locally and in compliance with labor regulations.
4. How fast can I hire someone in Bali using an Employer of Record (EOR)?
Most EORs can onboard a new hire in under a week, provided employment details and documentation are in order. This makes it significantly faster than waiting for a company registration to be finalized.
5. What types of employment contracts are commonly used in Bali?
When hiring in Bali, the two primary contract types you’ll encounter are: You can still work with freelancers or independent contractors in Bali, but these arrangements fall outside Indonesia’s Manpower Law and should only be used for short, clearly defined projects. To stay compliant, it’s much safer to hire through a licensed Employer of Record (EOR). Emerhub can connect you with a trusted local partner to handle compliant hiring and payroll. Simply reach out through the form below to speak with our advisor.