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Circular Letter No.M/6/HI.00.01/V/2020 concerning Implementation of Payment of Religious Holiday Allowance of 2020 in Companies during the Corona Virus Disease 2019 (COVID-19) Pandemic (“CL 6/2020”)

Approaching the religious day this May 2020, the Ministry of Manpower has issued a Circular Letter No. M/6/HI.00.01/V/2020 concerning Implementation of Payment of Religious Holiday Allowance of 2020 in Companies during the Corona Virus Disease 2019(COVID-19) Pandemic (“CL 6/2020”). Please find below the highlighted key figure of the mentioned CL 6/2020:

  1. Notwithstanding the current economic situation because of the COVID-19 pandemic, companies are obligated to pay Religious Holiday Allowance (Tunjangan Hari Raya Keagamaan or “THR”) to the worker/employee in accordance with the prevailing law.
  • In the event a company is unable to make the THR payment at the time stipulated by the prevailing laws, the company and the worker/employee may commence a negotiation to reach a mutual understanding on the following matters:
  1. if the company is unable to make a full payment of the THR in time, the THR payment may be done in installments;
  2. if the company is unable to make any payment of the THR at the stipulated time, the THR payment may be postponed for a determined period of time;
  3. the time and means of payment of the overdue fine.
  • Upon agreement, such understanding must be reported to the Manpower Agency (Dinas Ketenagakerjaan) within the respective region.
  • Such understanding does not release the company from the obligation of making the THR payment along with the overdue fine stipulated by the prevailing laws.
  • The THR and the overdue fine must be paid within the year of 2020.
  • The CL 6/2020 comes into force on 6 May 2020.
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