Workers Who Are Laid Off Will Receive 60 Percent Of Their Salary For A Duration Of Six Months, As Stipulated In PP 6/2025

Foto: Antara/Muhammad Adimaja

Workers Who Are Laid Off Will Receive 60 Percent Of Their Salary For A Duration Of Six Months, As Stipulated In PP 6/2025

Tuesday, 18 Feb 2025

President Prabowo Subianto has signed Government Regulation Number 6 of 2025, which stipulates that employees affected by Termination of Employment (PHK) are entitled to a cash benefit amounting to 60 percent of their wages for a maximum duration of six months.

This provision is outlined in Article 21 of Government Regulation (PP) Number 6 of 2025 concerning Amendments to PP 37/2021 on the Implementation of the Job Loss Guarantee Program (JKP), as referenced in a copy of the regulation obtained in Jakarta on Sunday.

"The cash benefit will be disbursed monthly at a rate of 60 percent of the wage, for a maximum of six months," states Article 21, paragraph (1) of PP Number 6 of 2025.

The article further specifies that the wage used as the basis for calculating the JKP benefit is the last wage reported by the employer to BPJS Ketenagakerjaan, with a maximum limit of IDR 5 million. If an employee's wage exceeds this upper limit, the wage used for the cash benefit calculation will be capped at this maximum amount, as indicated in Article 21 of PP 6/2025.

In the regulation signed by President Prabowo Subianto on February 7, 2025, several articles have been amended.

Among the changes is Article 11, which revises the contribution rate for JKP. Previously set at 0.46 percent of monthly wages, the rate has now been reduced to 0.36 percent, sourced from contributions made by the Central Government and funding for JKP.

The contribution from the central government is 0.22 percent of the monthly wage, while the funding for JKP is derived solely from the reallocation of contributions from the Work Accident Insurance Program (JKK) at a rate of 0.14 percent of the monthly wage.

Additionally, the regulation includes a new provision, Article 39A, which states in paragraph (1) that if a company is declared bankrupt or closed in accordance with applicable laws and has outstanding contributions for a maximum of six months, the JKP benefits will continue to be disbursed by BPJS Ketenagakerjaan.