Workers who are laid off a month before Eid are still entitled to receive THR

"The calculation of the amount of religious holiday allowance (THR) should be at least the same as stated in the circular (Circular Letter/SE Menaker Number M/2/HK.04/III/2024 concerning the Implementation of Religious Holiday Allowance in 2024 for Workers/Laborers in Companies). However, we recommend that the value of the THR be higher than the (regulated) SE if there is an agreement between both parties," said Indah.

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SE Menaker No M/2/HK.04/III/2024 was announced on March 18, 2024. It contains seven provisions. The first provision states that religious holiday allowance will be given to workers who have worked continuously for one month or more and workers with fixed-term employment contracts (PKWTT) or certain period employment contracts (PKWT). The second provision reads that religious holiday allowance must be paid no later than seven days before the religious holiday.

The third point regulates how religious holiday allowance is given. First, for workers/laborers who have worked continuously for 12 months or more, they will receive religious holiday allowance equivalent to one month's salary. Second, for workers/laborers who have worked continuously for one month but less than 12 months, their religious holiday allowance will be calculated based on their length of service divided by 12 months and multiplied by 1 month's salary.

Meanwhile, if there are workers who have employment based on a Fixed-Term Employment Agreement (PKWT) or contract, and their contract ends before religious holidays, they are not entitled to receive THR (religious holiday allowance). This provision is stipulated in Article 7 Paragraph (3) of the Ministry of Manpower Regulation No. 6/2016.

Indah added that they have not received accurate information regarding the rumors of layoffs, including those targeting employees with fixed-term employment contracts during Ramadan 2024. According to her, if there were no reports of layoffs filed with the Ministry of Manpower or labor agencies, it indicates that the layoff process was agreed upon by both workers and employers.

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Layoffs before Ramadan

However, President of the Confederation of Indonesian Trade Unions (KSPN) Ristadi, separately, stated that a number of KSPN members worked in a number of textile factories now experiencing layoffs. Among them there are those with PKWT status. The layoff decision received by KSPN members occurred ahead of and during Ramadhan 2024.

"Those who became victims of layoffs worked in textile factories, including in Bandung and Semarang. If the layoffs happen before Ramadan, we suspect the companies do not want additional financial burden for holiday allowances. Perhaps the factories are currently experiencing a decrease in orders," he said.

Furthermore, Ristadi said that outside of the National Textile Industry Special Zone (KSPN), it has been observed that contract workers employed in textile and textile product factories under a Fixed-Term Work Agreement (PKWT) have received decisions of no contract extensions from the factory employers. He suspects that the cause is similar to what was experienced by KSPN members who were laid off from textile factories.

From the information received by KSPN, they said that the factory where he worked was experiencing a downturn in demand, which was disrupting the company's cash flow. However, according to Ristadi, the need for workers during Ramadan and preparing for Eid al-Fitr usually increases.

"Contract workers with fixed-term and permanent contracts are entitled to receive their religious holiday allowance (THR), except if they are laid off before 30 days prior to the religious holiday. For example, being laid off before the start of Ramadan. If workers are not members of a union, it will make it difficult for them to obtain assistance/advocacy," he said.

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Meanwhile, General Chair of the Indonesian Textile Association (API) Jemmy Kartiwa Sastraatmaja said that the positive impact of Minister of Trade Regulation Number 36 of 2023 concerning Import Policies and Regulations is not instant. Prior to the issuance of this Minister of Trade Regulation, import activities were easier, thus hitting industrial players from large to small and medium levels, including in the textile and textile products sector, which caused layoffs in that sector.

Minister of Trade Regulation No. 36/2023 regulates raw material import facilities for industries holding producer importer identification numbers with authorized economic operator and customs main partners. Apart from that, the Minister of Trade Regulation also regulates the restructuring of import policies by shifting import supervision from post border to border.

"I hope that in the next 3-6 months (waiting for the reduced import stock), there will be improvement in the industrial sector so that laid-off workers can be reemployed," said Jemmy.

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