Small Entrepreneurs Opt for Dialogue with Employees

KOMPAS/STEFANUS ATO

Dozens of Bekasi City workers held a demonstration at the Bekasi City Government Office, West Java on Monday (12/4/2021) morning. They asked the local government to oblige the company to pay the the Idul Fitri bonus (THR) in full.

JAKARTA, KOMPAS — The government\'s policy requiring employers to pay the Idul Fitri bonus (THR) in full and on time before the end of the holiday is considered to be burdensome by some business actors affected by the COVID-19 pandemic. Employers are opting for a dialogue with employees to find THR payment solutions.

Chairman of the Indonesian Micro, Small and Medium Enterprise (MSME) Association (Akumindo) Ikhsan Ingratubun, when contacted on Tuesday (13/4/2021), said the purpose and objectives of the policy were good, namely to fulfill employees\' rights and drive the economy but that in fact the employers’ business conditions were not conducive to the requirement. He believed that many small-scale entrepreneurs would have difficulty paying the THR obligation this year.

Previously, the government asked companies to take advantage of various stimuli for business players and carry out their obligations. However, according to Ikhsan, the government’s stimulus and assistance are not easily accessible to entrepreneurs, especially micro and small enterprises, which are often deemed unfit for bank credit.

There are MSMEs [micro, small and medium enterprises] that are financially capable; some are not.

Employers who are unable to pay the THR will have a dialogue with employees. Employers are obliged to prove the company\'s financial inability and financial loss, as well as show the company\'s internal financial reports transparently. However, he emphasized the decision to pay or not to pay the THR bonus should be based on agreement between employers and employees.

"There are MSMEs [micro, small and medium enterprises] that are financially capable; some are not. For those that are able, please fulfill the obligations according to the rules. For those that are not capable, a government circular makes it possible for discussion through bipartite dialogue with workers," said Ikhsan.

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Manpower Ministry director of wages Dinar Titus Jogaswitani said employers had one month, until mid-May 2021, to assess their financial conditions and prepare the THR bonus payments. If the company decides not to pay the THR bonus, the government will impose sanctions in accordance with the provisions.

ANTARA FOTO/YUSUF NUGROHO

A worker shows money of the the Idul Fitri bonus (THR) at a cigarette factory in Kudus, Central Java, on Tuesday (5/6/2018).

Sanctions are given in stages, starting from a written warning, restricting business activities, temporary suspension on part or all of the means of production and culminating in freezing business activities. Companies that can afford it are required to pay the THR bonus no later than 7 days before Idul Fitri. Meanwhile, companies that are unable must prove their financial incapability by transparently disclosing their financial reports in the last two years to employees, holding bipartite dialogue and reporting to the government.

If the company is proven financially incapable, they are given leeway to pay the THR bonus no later than one day before Lebaran without any installment or postponement. "The dispensation is only given until one day before the Idul Fitri holiday," said Manpower Minister Ida Fauziyah.

I think there are also employers and businesses that are also in difficult conditions. For those who cannot pay this [THR bonus], what is the solution?

Indonesian Chamber of Commerce and Industry (Kadin) deputy chair for manpower and industrial relations Anton J Supit hoped the government could provide dispensation for several companies, such as small-scale businesses or those affected by COVID-19.

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"The circular is a problem because it applies [to all businesses] equally, and there is no dispensation for anyone. Employees are in a difficult situation; that\'s not debatable. However, I think there are also employers and businesses that are also in difficult conditions. For those who cannot pay this [THR bonus], what is the solution?" said Anton.

According to Anton, the decision must be left to the result of the dialogue with employees. "Those who know best about the condition of the company are bipartite, namely the employees and the management of the company itself," he said.

KOMPAS/PRIYOMBODO

Visitors choose clothes at Blok A Tanah Abang Market, Central Jakarta, Saturday (05/25/2019). The textile market was filled with buyers along with the disbursement of the Idul Fitri bonus to state civil servants and private employees.

This article was translated by Kurniawan Siswoko.