Making employees who have been in their job for just one month eligible for the holiday allowance ( THR ) may increase costs for Indonesian companies. But the government is persistent with the measure, which it sees as part of its effort to support labor rights.

The Ministry of Manpower has issued a 2016 regulation, replacing a 1994 regulation, mandating that the THR be delivered to all new employees of one months’ service or longer.

Previously, employees were required to work for at least three months to receive the THR. The amount of THR is one months’ salary, or on a pro rata basis for employees who have been in a job for less than a year.

“It is based on an equality principle when workers sign the contract. On the first day they work, they already have full rights to THR since their contribution is equal to permanent employees,” Minister of Manpower Hanif Dhakiri said on April 28 in Jakarta.

There is no significant difference between the contracted and the permanent employees, the minister said, except for their working status.

Work contributions aside, Hanif continued, contracted and permanent employees face similar risks. “Even their responsibilities, for workers sitting on the same level, are pretty much the same.”

Equal treatment for holiday allowance for contracted workers has long been debated in Indonesia, amid rising demands for change from both workers and employers. However, the change must involve the House of Representative ( DPR ) as it is related to the 2003 law on manpower.

“Both employers and employees want to change it, but they want to align it more with their own interest, in different directions. Before we bring this issue to the House, we need to unify the concept first,” Hanif said.

Sudden termination

Hanif said that several employers deliberately recruited contracted workers just after the Eid al-Fitr holiday and suddenly laid them off right before the next Eid to avoid paying THR.

“It is the company’s right to decide contract dates, including terminating them before the Eid. But the termination process must follow procedure and employees must have their rights upheld. On the other side, employees must pay attention to their contracts and be aware of such scenarios. Consult with other workers who are experienced with that problem,” Hanif said.

To monitor and educate around all labor issues, including the THR payment, the ministry has created a special task force. The government has warned of administrative sanctions for employers who pay THR late. The fine is equal to 5 percent of the total delayed THR payments.

“If there are no THR payments at all, then further administrative sanctions will be imposed,” Hanif warned.

Every week, the Minister gathers 20 to 30 people, both from employers’ associations and labor unions, at his house. “We do this continuously for the purpose of unifying their thinking on labor issues,” he said.

The continuous discussion is necessary as Indonesia is home to a massive laboring workforce with nine workers confederation and 108 labor federations, not including unaffiliated federations.

Regarding THR payment disputes that are submitted to the government, the minister said the number varied. In 2011, there were 57 cases [but they declined] over the years to 28 cases in 2012, 26 cases in 2013 and eight cases in 2014.

In 2015 the complaints rose to 52 cases, but two of those did not state proper addresses. “Thus, there were 50 cases officially. We have solved 49 cases, and we have one to go. Based on this improvement, I’m sure the number of complaints will decrease in the future,” Hanif said.

Source:
courtesy of THE JAKARTA POST

by The Jakarta Post

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