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Jakarta SMEs struggle with Eid bonus payouts

Jakarta Globe - March 18, 2024

Alfida Rizky Febrianna, Jakarta – The Chamber of Commerce and Industry (Kadin) of Indonesia has disclosed that micro and small-scale businesses in Jakarta are encountering challenges in disbursing Eid bonuses (THR).

"Micro and small business proprietors are already voicing their concerns. The primary issue stems from the decline in public purchasing power, leading to a shortfall in revenue," Diana Dewi, Chairwoman of Kadin Jakarta, told Beritasatu.com on Sunday.

Diana indicated that small business owners grappling with the payment of their employees' THR are seeking Kadin's assistance to negotiate with the government.

She further explained that Kadin maintains ongoing communication with the Manpower Office of Jakarta to secure exemptions from penalties for select business owners unable to fulfill THR obligations this year.

"Undoubtedly, we provide comprehensive and precise data to the Manpower Office, demonstrating that these businesses should not be subject to sanctions. This underscores our commitment as governmental collaborators and our endeavor to reassure Kadin members," she affirmed.

Diana proposed that Kadin recommends bipartite discussions between employers and employees to arrive at a mutually acceptable resolution.

"Given that employees possess a better grasp of their company's circumstances, we entrust bipartite negotiations to employers and their staff," Diana explained.

Nevertheless, Diana stressed that employers remain obliged to disburse THR in accordance with government regulations.

Manpower Minister Ida Fauziyah has directed companies to remunerate full THR to their employees no later than 7 days before Eid al-Fitr. Non-compliance may result in penalties, including written warnings, restrictions on business operations, temporary or partial halts to production facilities, and even business suspensions.

Source: https://jakartaglobe.id/business/jakarta-smes-struggle-with-eid-bonus-payout