Minister Issues Circular on Religious Festivity Allowance for Workers

Ahead of Eid al-Fitr, Minister of Manpower Ida Fauziyah Wednesday (04/06) has issued Circular Number M/1/HK.04/IV/2022 on the 2022 Implementation of Religious Festivity Allowance (THR) Payment for Workers/Laborers in Companies.

The Circular, which is addressed to governors throughout Indonesia, is aimed at ensuring the provision of THR for workers/laborers as an effort to fulfill the needs of workers and their families in celebrating religious holidays.

“Based on Government Regulation Number 36 of 2021 on Wages and Regulation of Minister of Manpower Number 6 of 2016 on Religious Festivity Allowance for Workers/Laborers in Companies, providing religious festivity allowance is an obligation employers must carry out to their workers,” the Circular reads.

The THR must be paid based on the following provisions;

1. The THR payment is made to workers/laborers who have a continuous service period of one month or more.
2. THR is also given to workers/laborers based on a work agreement for an unspecified period of time or a fixed-term work agreement.
3. For workers/laborers with a continuous service period of 12 months or more, THR will be given equivalent to one month’s salary.
4. For workers/laborers with one month service period continuously, but less than 12 months, THR will be given proportionally according to the calculation of working period divided by 12 months and multiplied by one month’s salary.
5. For workers/laborers who work based on a daily work agreement and have worked for 12 months or more, one month’s salary is calculated based on the average wages received during the last 12 months prior to religious holidays.
6. For workers/laborers who work based on a daily work agreement and have worked for less than 12 months, one month’s salary is calculated based on the average wages received each month during the working period.
7. For workers/laborers whose salary is determined based on output, one month’s salary is calculated based on the average wages received during the last 12 months prior to religious holidays.
8. For companies that have been stipulating the amount of THR in a work agreement, regulation of the company, joint work agreement, or based on prevailing practice applicable in that company in which the amount is higher than the amount referred to in number 3 and number 4, the THR will be given to workers/laborers based on a work agreement, regulation of the company, joint work agreement, or based on prevailing practice.
9. THR must be paid no later than seven days prior to the religious holidays.

In a bid to ensure the smooth payment of THR for workers/laborers, governors are advised to push employers in their respective regions to pay the THR based on provisions of laws and regulations. In addition, Manpower Task Force will also establish a command post in each province to anticipate the complaints regarding the implementation of THR payment. (PR of Ministry of Manpower/UN) (RAS/MUR)