For those who do business in Indonesia.
The Ministry of Labor has issued a Regulation on the payment of annual religious leave benefits. Now every employer (owner of a business in Indonesia) must provide their employees with religious leave (THR) in full, without the possibility of deferral, and no later than seven days before the start of the religious holiday.
The payments are due to all employees who have worked continuously for at least one month, regardless of their employment relationship, whether it is a fixed-term employment contract or an indefinite contract.
The amount of religious leave benefits for employees who have worked continuously for 12 months or more is one month's salary.
Employees who have worked for more than one month, but less than 12 months, are entitled to THR proportionally to the time worked.
Companies can provide THR in amounts exceeding the legal norms. According to the Minister of Manpower Regulation, organizations have the right to establish higher sums of THR in employment contracts, internal rules, collective employment contracts, or based on established company practices, while complying with legal requirements.
Calculation of religious benefits THR:
If an employee has worked for 12 months or more, the monthly salary is calculated based on the average monthly salary for the last 12 months before the religious holiday. For temporary workers whose period of work was less than 12 months, the monthly salary is determined based on the average monthly salary for each month during their employment.
Temporary workers with daily labor agreements, as well as employees with one-time salaries, are also entitled to THR. They are paid an amount calculated based on the average monthly salary for the last 12 months before the religious holidays.
It is important to emphasize that for some export-oriented labor-intensive industrial companies, which make adjustments to working time and wages in accordance with Resolution 5/2023, the obligation to pay religious benefits remains. The salary used as the basis for calculating THR is the last value before adjusting the wage.
In Islam, Ramadan is the main holiday, for Christians - Christmas, and for Hindus - Nyepi. To make payments for religious leave correctly, it is necessary to know the religion of your employees, find out which holidays are key, and compare them with the calendar of holidays for the timely organization of leave.
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