Legal Sanctions for Companies That Are Late or Don't Pay Religious Holiday Allowances

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By:

Team of Hukumindo

Previously, the Hukumindo.com platform has talk about "Canada Legalizes Medical Suicide for Severe Mental Illness", "I Have a Contract Whose Goods Have Not Been Delivered, How Do I Sue Under Indonesian Law?", you may read also "What Language Must Be Used In The Agreement In Indonesia?" and on this occasion we will discuss about 'Legal Sanctions for Companies That Are Late or Don't Pay Religious Holiday Allowances'.

Legal Term & Governing Law

Religious Holiday Allowance or commonly called 'THR' is a worker's income right that must be paid by employers to workers ahead of Religious Holidays in the form of money. Religious holidays here are Eid al-Fitr for Muslim workers, Christmas Day for Catholic and Protestant Christians, Nyepi Day for Hindu workers, Vesak Day for Buddhist workers, and Chinese New Year. for Confucian workers.[1]

The statutory regulation that regulates is the Minister of Manpower and Transmigration Regulation Number 6 of 2016 concerning Religious Holiday Allowances for Workers/Workers in Companies (Permenaker 6/2016) where this regulation replaces the Regulation of the Minister of Manpower and Transmigration Number PER.04/MEN /1994. There are also new regulations, Government Regulation Number 36 of 2021 concerning Wages (PP 36/2021) and SE Minister of Manpower Number M/6/HK.04/IV/2021 concerning the Implementation of Providing Religious THR in 2021 for Workers/Labourers in Companies.[2]

THR Payment Obligations by the Company

The Minister of Manpower (Menaker) Ida Fauizyah reminded employers of the fines and sanctions imposed if they did not fulfill the obligation to pay religious holiday allowances (THR) to their employees. "I emphasize that the Religious THR must be paid no later than seven days before the religious holiday of the worker or laborer in question," he said at a virtual press conference of the Ministry of Manpower (Kemnaker) monitored from Jakarta on Monday (12/4/2021).[3] The provisions regarding THR in 2022 have not changed much.

For companies affected by Covid-19 and unable to provide THR 2021 according to the specified time, the circular requires employers to have a dialogue with workers to reach an agreement that is carried out in a family manner and in good faith and based on internal financial reports. The results of the dialogue must be reported to the Local Manpower Office (Disnaker) by giving THR no later than the day before the religious holiday.[4]

Legal Sanctions

Companies that fail to pay the holiday allowance (THR) will receive fines and sanctions from the Ministry of Manpower. Entrepreneurs who are late in paying religious THR to workers/labor will be subject to a fine of 5% of the total THR that must be paid since the expiration of the deadline for the entrepreneur's obligation to pay. The imposition of the fine does not eliminate the obligation of the entrepreneur to continue to pay religious THR to workers/labor.[5]

Entrepreneurs who do not pay religious THR to workers/laborers within the stipulated time, no later than 7 days before the religious holiday, are subject to administrative sanctions. The imposition of administrative sanctions does not eliminate the entrepreneur's obligation to fines for late payment of religious THR as regulated in the legislation. "Entrepreneurs who do not pay religious THR are subject to administrative sanctions in the form of written warnings, restrictions on business activities, temporary suspension of part or all of production equipment and freezing of business activities," explained Minister of Manpower Ida.[6] And if you have any legal issue with this topic, contact us then, feel free in 24 hour, we will be happy to assist you. 

*) For further information please contact:

Mahmud Kusuma Advocate

Law Office

Jakarta - Indonesia.

E-mail: mahmudkusuma22@gmail.com

________________

References:

1. "Tanya Jawab Seputar Tunjangan Hari Raya (THR)", gajimu.com., Diakses pada tanggal 9 April 2022, https://gajimu.com/pekerjaan-yanglayak/pengupahan/tunjangan/thr

2. Ibid.

3. "Ini Sanksi untuk Perusahaan yang Telat dan Tidak Bayar THR", kabar24.bisnis.com., diakses pada tanggal 9 April 2022, https://kabar24.bisnis.com/read/20210412/79/1379799/ini-sanksi-untuk-perusahaan-yang-telat-dan-tidak-bayar-thr.

4. Ibid.

5. "Telat bayar THR, ini denda dan sanksi yang bakal diterima perusahaan", kontan.co.id., Diakses pada tanggal 9 April 2022, https://nasional.kontan.co.id/news/telat-bayar-thr-ini-denda-dan-sanksi-yang-bakal-diterima-perusahaan

6. Ibid.