The Minister of Manpower, Ida Fauziyah, has just issued a circular letter containing rules regarding the implementation of the Religious Holiday Allowance (THR). In the circular, THR as one of the obligations that must be fulfilled and paid by business actors to their workers / laborers must now be paid by the company a maximum of 7 days before the Religious Holiday. Usually, employees/laborers who have worked for 12 months or more will receive an THR of 1 month’s salary. However, what are the provisions that apply to employees / laborers who have just worked or have less than 1 year of service in a company? Do these employees/laborers also have the right to receive THR? To answer this question, Contract Law will provide an explanation below.
Religious THR
Religious THR is non-wage income that must be paid by the authority to workers/laborers or their families ahead of Religious Holidays. The Religious Holidays referred to are Eid al-Fitr for workers/laborers who are Muslims, Christmas for workers/laborers who are Catholic Christians and Protestant Christians, Nyepi for workers/laborers who are Hindus, Vesak for workers/laborers who are Buddhists, and Lunar New Year for workers/laborers who are Confucian. Article 2 of Minister of Manpower Regulation No. 6/2016 on Religious Holiday Allowance states that every worker/laborer who has worked for one month continuously or more has the right to receive THR. However, the worker/laborer must have a working relationship with the employer based on an indefinite period work agreement or a specific time work agreement. This means that workers/laborers who have worked for less than 12 months or have just started working but have been working for more than 1 month are also entitled to receive THR. In SE Menaker No. M/6/HK.04/V/2021, workers/laborers who have worked for 1 month continuously, but less than 12 months, THR is given proportionally according to the calculation of the length of service divided by 12 months then multiplied by 1 month’s wage. For example, A is an employee who is contracted for 2 years but has only worked for 3 months before the holiday. A has a basic salary of Rp 6,000,000. Based on the applicable rules, A will get THR with the calculation: Period of Service / 12 × salary earned during the month 3/12 × Rp 6,000,000 = Rp 1,5000,000 In addition to the calculation of the amount of THR received by employees/laborers, the SE Menaker also states that THR for Eid al-Fitr this year may not be paid in stages/in installments. THR must also be given to workers/laborers no later than 7 days before the holiday. Companies that are unable to provide THR according to the specified time due to the impact of the Covid-19 pandemic are required to make an agreement with workers/laborers and submit a transparent internal company financial report to the Manpower Office where the company is located. Although there is an agreement regarding the payment of THR, this does not eliminate the obligation of employers to pay Religious THR in 2021 to workers / laborers. Then, will employers be sanctioned if they are late or even do not pay THR to their workers/laborers? Employers who are late in paying Religious THR to workers/laborers will be subject to a fine of 5% of the total THR that must be paid since the expiration of the deadline for the employer’s obligation to pay. Employers will also be subject to administrative sanctions ranging from written warnings to suspension of business activities if they refuse or do not pay Religious THR to workers/laborers. Despite receiving fines and administrative sanctions, this still does not eliminate the employer’s obligation to continue paying THR. Read also: Rules for Calculation and Provision of THR
KH Contact
Well Friend KH, that’s the explanation of the THR provisions for new employees who have less than 1 year of service. If you have any questions regarding labor regulations in Indonesia or want to consult regarding other legal issues, do not hesitate to contact the Legal Contract at the Ask KH link.
