The long-waited JKP took effect earlier this month, shortly before the early withdrawal of JHT funds is set to be banned in May.

Manpower Ministry Ida Fauziyah said on Tuesday that the JKP could accommodate workers who were in need of money after being laid off by their company, so that they no longer needed to use their accrued JHT funds, which they would be able to access after turning 56.

Under the prevailing rules, which are about to change, workers who resign or have been laid off can pull out JHT benefits after a one-month waiting period, regardless of their age.

“The JKP program is designed specially to cover risks from being laid off. Starting this February, workers can enjoy the benefits,” Ida said through the ministry’s online broadcast.

Read also: Workers protest restrictions on pension cash-out

The JKP was introduced under Government Regulation No. 35/2021, which is based on the 2020 Job Creation Law. It has been welcomed by businesses, as its introduction went hand-in-hand with a reduction in the amount of compensation employers must pay laid-off workers.

The benefits are proportionate to the worker’s salary – but capped at the amount applicable to a Rp 5 million monthly salary – and can be claimed for up to six months. They amount to 45 percent of the salary for the first three months, followed by 25 percent for the last three months.

Hence, a worker losing a job that paid Rp 5 million or more would receive a total of Rp 10.5 million over the six-month period, as well as training and information on job openings provided by the government.

The government has promised the scheme will be funded from the state budget and has allocated Rp 6 trillion, which it forecasts will cover up to 300,000 laid-off people this year.

However, at least three labor unions, namely the Confederation of Indonesian Trade Unions (KSPI), the Indonesian Trade Unions Association (Aspek) and Sindikasi – a trade union for media and creative workers – have contested the JKP, arguing that early access to JHT funds is preferable.

“Workers have been told to be grateful for this JKP, but that is absurd,” Aspek president Mirah Sumirat told the audience in an online discussion on Tuesday.

Eligibility for JKP payouts requires that a worker has been registered for all employee and health benefits for at least two years and has missed no payment for the first year and the last six months of employment.

But critics say many employers shirk their responsibility to comply with these requirements, which could render laid-off workers ineligible for the JKP.

The regulation also states that the JKP is financed by repurposing part of a worker’s monthly contribution to the Workers Social Security Agency (BPJS Ketenagakerjaan), contradicting the government claim that it is entirely funded through the state budget.

JKP benefits can also be claimed no more than once in five years and no more than three times in total, meaning a worker losing their job again within five years of the previous lay-off, or for the fourth time in their life, cannot get the support.

Furthermore, a worker on a limited-term contract can only claim the JKP if fired before the contract ends; the employer’s refusal to renew a contract does not count as a lay-off.

Bimo Aria Fundrika, advocacy coordinator at Sindikasi, said on Monday that the JKP scheme failed to take into account that many employers, rather than firing employees, urged them to resign, so as to skirt severance pay obligations.

The regulation states that JKP benefits cannot be claimed by employees quitting their job voluntarily.

“The JKP [scheme] still has many loopholes that undermine workers’ positions,” Bimo said in a statement.

Read also: BPJS Ketenagakerjaan needs government help to pay compensation to laid-off workers

Manpower Ministry spokesperson Dita Indah Sari defended the regulation, arguing that it was a worthy alternative for laid-off workers, despite all the flaws.

“The JKP is still novel. We do not claim it is perfect, but we need to start the unemployment benefits nevertheless. If not now, when else?” Dita told the audience at an online discussion on Tuesday.

She defended the fact that the JKP did not cover workers who resign, arguing that everyone who did that already had a plan in mind, and they could still be covered by social aid if needed. Cases where coercion was used, she said, could be settled through industrial relations dispute resolution.

However, Bivitri Susanti, a constitutional law expert from the Jakarta-based Jentera School of Law, contested the implementation of the JKP.

She referred to a 2021 Constitutional Court ruling that the government must refrain from executing any “strategic policy” under the 2020 Job Creation Law.

Yet, Bivitri said, the law explicitly referred to its manpower provisions, including the JKP, as “strategic policies”.

“The Constitutional Court decision is actually clear; [the new unemployment benefit scheme] cannot be executed, because it has broad and strategic impact. If it is executed, it can be brought to court,” Bivitri told the Post on Wednesday.

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