The Minister of Labor said that only 7 percent of the companies paid severance pay under the previous law

TEMPO.CO, Jakarta The Minister for Labor (Menaker), Ida Fauziyah, said that the provisions on severance pay laid down in Act no. 13/2003 on labor are often not implemented. This is because only 7 per cent of the companies pay severance pay in accordance with the stipulated regulations.

“Act 13 of 2003 on the provisions for severance pay is really very good 32 times (severance pay is 32 times the salary). However, only 7 percent comply with the provisions. So the law means that it is not implemented,” said Ida Fauziyah on the official YouTube page of the Indonesian Crew Ministry on Wednesday 14 October 2020.

Ida also said that 27 percent of the companies paid according to the agreement, but according to the law’s provisions. “It should not be,” he said.

According to Ida, this was done because the company did not have the opportunity to pay a large amount of severance pay for workers or workers to resign 32 times the salary. “Because it’s considered too high.”

As I reflected on this fact, Ida said, the severance pay in the Job Creation Act was lowered with the principle of ensuring that severance pay is really a right and can be accepted by workers. “The government does not want that, so it is certainly lowered,” he said.

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