Rizki Fachriansyah, Jakarta – The Confederation of Indonesian Trade Unions (KSPI) has spoken out against a circular issued by the Manpower Ministry that would purportedly allow employers to cut holiday bonuses (THR) and postpone the distribution of financial incentives ahead of Idul Fitri, amid the turbulence triggered by the COVID-19 pandemic.
KSPI chairman Said Iqbal said the circular violated Law No. 13/2003 and Government Regulation No. 78/2015, which stipulate that every employer is obligated to provide a holiday bonus to employees who have worked at the company for more than one year without any prior negotiation.
Employees who have been on the payroll for less than one year, meanwhile, have a right to receive an incentive provided in accordance to the duration of their employment, Said added.
"We must reject the ministry's circular; employers must provide 100 percent of their employees' holiday bonus. Providing less than full holiday compensation, or releasing the funds in installments is simply out of the question," he said in a statement on Thursday.
Said went on to say that the organization would file a lawsuit against the ministry's circular at the Jakarta State Administrative Court (PTUN) as he claimed the document had directly contradicted prevailing laws.
Furthermore, the labor organization would also set up emergency posts across 30 provinces where employees were able to safely report unfair compensation from their employers.
The COVID-19 pandemic has disrupted business activities as consumers stay home to curb the virus spread, resulting in weakening demand. Companies across the country, mainly those operating in the hospitality sector, have furloughed or laid-off employees.
Last month, the Industry Ministry discussed the possibility of providing businesses with soft loans to enable them to pay Idul Fitri holiday bonuses as the economic downturn is forcing companies to withhold or cut the bonus payment.