In the recruitment world—especially for headhunter companies, executive search agencies, and human capital management professionals—the term “all-in salary” often becomes a point of consideration for both candidates and HR. An all-in salary refers to a compensation structure where all components—base salary, fixed allowances, and other incentives—are combined into one lump sum without detailed breakdowns. But here’s the important question: is this scheme safe without proper benefits?
Let’s explore it thoroughly, from the HR practices in Indonesia to the legal aspects and implications for both companies and employees.
What Is an All-In Salary?
An all-in salary means the employee’s total income—including base salary, fixed allowances, and non-fixed allowances—is summed up into a single number. There’s usually no separate breakdown for items like meal, position, or transportation allowances. For example, if an employee is offered an all-in salary of IDR 12 million, it already includes all forms of regular compensation, whether fixed or variable.
Is It a Common Practice in Indonesia?
In Indonesia, the employment system generally prefers separating salary components. This is important because the Religious Holiday Allowance (THR) is calculated based on base salary and fixed allowances only. If a salary is bundled into an all-in scheme, the entire amount—including non-fixed components—must be used for calculating THR. This could place a greater financial burden on the company during THR payments or final settlements.
Salary Scheme Comparison
Separated Salary:
- Base salary: IDR 8 million
- Fixed allowance: IDR 2 million
- Performance bonus: IDR 2 million
- THR is calculated based on IDR 10 million (base + fixed allowance)
All-In Salary:
- Flat IDR 12 million
- Everything is considered “fixed,” so THR is calculated from IDR 12 million
- No flexibility to add extra allowances without increasing cost
Is It Legally Safe?
The answer is no, if the company fails to fulfill mandatory employee entitlements. From a human capital management perspective, companies must still provide:
- BPJS Healthcare
- BPJS Employment Insurance
- THR
- Minimum 12 days of annual leave after 12 months of work
Claiming that these obligations are “included in the all-in amount” without actually providing them violates Indonesian labor regulations.
What Are Real Benefits?
It’s crucial to distinguish between legal obligations (like BPJS and THR) and benefits. Benefits refer to additional perks beyond legal requirements, such as:
- Discounts on partner products (e.g., telecom services)
- Insurance beyond BPJS
- Extra leave
- Wellness programs (yoga, team sports)
- Flexible working hours (hybrid/remote work)
- Child support, scholarships, or career development programs
Such benefits can enhance a company’s attractiveness and strengthen employer branding—a strategy often adopted by well-established firms and executive search agencies like HRnetRimbun to retain top talent.
When Is the All-In Scheme Acceptable?
The all-in scheme may be acceptable for non-permanent employment, such as freelancers or project-based work. In such cases:
- No fixed working hours
- No employer obligations for BPJS or THR
- Payment based on deliverables
However, for permanent (PKWTT) or fixed-term (PKWT) employees, this scheme is risky if it does not comply with labor laws.
Read more: Walk-In Interview vs Scheduled Interview: Which One Is More Beneficial?
Conclusion
An all-in salary without benefits is not a safe scheme if it doesn’t comply with Indonesian labor regulations. While the system may be used, companies must ensure:
- Legal rights of employees are protected (BPJS, THR, leave)
- Compensation structure remains flexible and fair
- Budget efficiency does not come at the cost of compliance
For HR professionals, it’s vital to implement a salary system that is not only efficient but also legally sound and attractive in the long term. For candidates, always read contracts carefully and ask about salary components, benefits, and employer obligations.
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