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Companies must pay holiday bonuses without delay, orders minister
The Manpower Ministry's new circular letter requires businesses to pay holiday bonuses (THR) at the latest a day before a religious holiday.
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Manpower Minister Ida Fauziyah in an undated photograph. (Courtesy of Manpower Ministry)
T
he Manpower Ministry issued Monday a circular letter obligating employers to pay holiday bonuses (THR) without deferment this year ahead of Idul Fitri.
The letter reverses last year’s decision that allowed pandemic-hit businesses to either pay the bonus in installments or delay payments altogether. Under the new letter, companies must pay bonuses no later than a week before a religious holiday, most pressingly Idul Fitri, which is expected to fall on May 12.
Pandemic-hit businesses unable to pay within the timeframe have to prove their inability by disclosing financial statements and must negotiate new payment terms with employees but are, nevertheless, required to pay no later than a day before the religious holiday.
“THR is an obligation that employers must pay to their workers,” Manpower Minister Ida Fauziyah was quoted as saying in a press release on Monday.
“Particularly during this economic recovery phase, THR can clearly stimulate spending, which can drive economic growth.”
Indonesia’s household spending shrank last year as 29.12 million workers saw reduced incomes under the economic crunch. Of them, 2.56 million were unemployed, 760,000 pushed out of the workforce, 1.77 million furloughed and 24.03 million faced shorter working hours, Statistics Indonesia (BPS) found in August last year.
Read also: Unemployment surges to decade high as COVID-19 causes millions to lose jobs
