New Regulation on COVID-19 Vaccines Procurement
On October 5, 2020, President Joko Widodo signed the Presidential Regulation No. 99 of 2020 on the Vaccines Procurement and Implementation of Vaccination for Handling the Corona Virus Disease 2019 (COVID-19) Pandemic (“PR 99/2020”) which entered into force the day after. PR 99/2020 is intended to expedite the vaccines procurement and vaccination.
We set out below the key provisions of PR 99/2020.
- Vaccine Procurement
Under PR 99/2020, the COVID-19 vaccine procurement covers (i) the provision of COVID-19 vaccines and supporting equipment and logistics needed; and (ii) the distribution of the COVID-19 vaccines until the delivery point determined by the Minister of Health (the “Minister”).
The implementation of the COVID-19 vaccines procurement shall be carried out by way of (i) the designation of a state-owned enterprise, (ii) a direct appointment to vaccine providers, and/or (iii) the cooperation with international institutions provided that the cooperation is only limited to the provision of COVID-19 vaccines and the cooperation excludes the supporting equipment for COVID-19 vaccination. Supporting equipment includes personal protection equipment (hazmat suits, face shields, medical gloves, and surgical masks), alcohol-based antiseptics, and safety boxes for bio-waste disposal.
- Designation of a State-Owned Enterprise
The Minister designates PT Bio Farma (Persero) (“Bio Farma”) as the state-owned enterprise to procure the COVID-19 vaccines with the type and number of the COVID-19 vaccines determined by the Minister. In this case, Bio Farma may involve its subsidiaries, i.e., PT Kimia Farma Tbk and PT Indonesia Farma Tbk. Bio Farma may also cooperate with local or foreign business entities and/or institutions for procuring the COVID-19 vaccine.
- Direct Appointment to Vaccine Providers
In line with the designation of Bio Frama, the direct appointment to the other business entities is carried out by the Minister. The vaccine providers may be in the form of national or foreign business entities that meet the requirements determined by the Minister, including: possession of a certificate on manufacturing practice for pharmaceutical products or a certificate on good distribution practice for pharmaceutical products.
- Cooperation with International Institutions
The cooperation is carried out with international institutions which are currently offering or establishing cooperation for research, production, and/or procurement of the COVID-19 vaccine. The Minister determines the type and amount of COVID-19 vaccine procurement by taking into account the consideration from the Committee for COVID-19 Handling and National Economic Recovery.
Based on that, the Ministry of Foreign Affairs (the “MOFA”) establishes the cooperation with the Coalition for Epidemic Preparedness Innovations (CEPI) as an international institution.
In addition, the Minister may cooperate with the Global Alliance for Vaccines and Immunizations (GAVI) as an international institution. However, this cooperation may also be carried out through Bio Farma as the designated state-owned enterprise.
It is worth noting that the Minister determines the purchase price of the COVID-19 vaccines by taking into account the state of emergency and availability of the COVID-19 vaccines. Thus, the purchase price for the same type of vaccines may differ since it depends on a number of factors that may differ from time to time.
- Vaccination Implementation
The Ministry of Health (the “MOH”) will carry out the COVID-19 vaccination based on (i) criteria and priorities for vaccine recipients; (ii) priority areas for vaccine recipients; (iii) schedule and steps for providing vaccines; and (iv) vaccination standard services, by taking into account the consideration from the Committee for COVID-19 Handling and National Economic Recovery. Further provisions on the COVID-19 vaccination shall be governed in a Regulation of the Minister.
- Funding for Vaccine Procurement and Vaccination
The vaccine procurement and vaccination of COVID 19 are covered by State Budget and/or other legal and not binding sources in accordance with the prevailing laws and regulations. Advance payment may be given to the provider for more than 15% (fifteen percent) from the multi-year contract value, as stipulated under the agreement/contract.
In supporting the designation of Bio Farma to procure the COVID-19 vaccines, the Government may provide an additional State Capital Participation (Penyertaan Modal Negara) to Bio Farma. Regional governments may also provide funding in their respective Regional Budgets to support the COVID-19 vaccination in their respective regions.
The Government may provide additional fiscal incentives such as tax, customs, and excise reliefs to import vaccine, raw materials, and equipment needed in the COVID-19 vaccine production and vaccination.
***
October 12, 2020
Copyright © 2020 AKSET. All rights reserved.
Newsflash PR 99 2020 (COVID-19 Vaccine Procurement)
Manpower Law Amended
17 years after the enactment of Law No. 13 of 2003 dated March 25, 2003 on Manpower (the “Manpower Law”), certain provisions of the Manpower Law are now amended. On October 5, 2020, the House of Representatives passed the Job Creation Law (or publicly known as the Omnibus Law) which contain certain amendments of the Manpower Law (the “Amended Manpower Law”) along with amendments to other 80 existing laws.
At the time this newsflash is issued, the Job Creation Law is still undergoing final redactional reviews and the promulgation process with the State Secretary (for the signing by the President). The Omnibus Law is not effective yet until it is signed by the President and promulgated. If the President does not sign the Omnibus Law in 30 days from October 5, 2020, the Omnibus Law becomes effective then by law. Accordingly, the final draft we reviewed may not be promulgated verbatim, and we should expect changes (albeit non substantial) in the latest version of the Law that is enacted.
Among the numerous amended laws, the Amended Manpower Law is one controversial issue which results in a series of demonstrations and opposition from the labor workforce. The Amended Manpower Law may be found at Chapter 4 Article 81 of the Omnibus Law. The highlights of the salient points of the Amended Manpower Law are as follows:
- USE OF EXPATRIATES
Principally, an employer that wishes to employ an expatriate must have a Foreign Manpower Utilization Plan (Rencana Penggunaan Tenaga Kerja Asing – an “RPTKA”). Under the Amended Manpower Law, an RPTKA is not required in the following cases: (i) for directors or commissioners with certain shares ownership or shareholders in accordance with applicable laws, (ii) for diplomats and consulars working at representative offices of foreign countries, or (iii) for foreigners who are needed for the production activities that are halted due to an emergency, vocational, start-up companies, business visits, and research for a certain period. Further provisions on utilization of expatriates will be stipulated in a Government Regulation.
- FIXED-TERM EMPLOYMENT AGREEMENTS
It appears that the Amended Manpower Law no longer stipulates the maximum period of fixed-term employment agreements. But, the Amended Manpower Law still states that fixed-term employment agreements shall not be entered into for the work that is permanent in nature. So in our view, it is very unlikely that an employer may use a ‘perpetual’ fixed-term employment agreement given the ephemeral nature of a fixed-term employment agreement in the first place.
Previously, fixed-term employment agreements entered in a foreign language only and not in Roman alphabets would convert into indefinite-term employment agreements. This provision is not in the Amended Manpower Law.
The Amended Manpower Law introduces new provisions regarding compensation pay payable to fixed-term employees upon completion of the employment period or the completion of the work. The amount of such compensation pay is based on the completed year(s) of service. However, there is no change in the provision regarding the compensation entitlement for termination of fixed-term employment prior to the completion of employment period as stipulated in Article 62 of the Manpower Law.
Further provisions on fixed-term employment agreements and compensation pay for fixed-term employees will be stipulated in a Government Regulation.
- SUBCONTRACTING AND OUTSOURCING
Subcontracting service (business to business) provisions under the Manpower Law are revoked. This revocation now allows companies to freely subcontract any work to any third party based on commercial terms agreed by the parties.
For outsourcing, the Amended Manpower Law is now silent on the types of work that may be outsourced to outsourcing companies. The outsourcing arrangement itself remains acknowledged. Note that the Amended Manpower Law requires an outsourcing company to ensure that an outsourced employee will continue to work in the same work if the outsourcing is granted to another outsourcing company.
- WORK HOURS
Previously, the Manpower Law provided that overtime work is allowed for a maximum of 3 hours per day and 14 hours per week. The Amended Manpower Law stipulates that overtime work may be performed for a maximum of 4 hours per day and 18 hours per week. While there is an increase of the overtime hours, the approval of the employees for any overtime is still required.
- WAGES
Wages are determined based on time unit and/or output unit. Article 88C of the Amended Manpower Law provides that Governors must determine the provincial minimum wages and may also determine regency/city minimum wages subject to regional economic growth and inflation. The determination of a Governor on minimum wages shall taking into account the economy and manpower conditions based on data derived from the statistics agency. Note that micro and small businesses are exempt from the minimum wages requirement. We note that further detailed provisions on wages will be stipulated under a Government Regulation.
In addition, Article 95 of the Amended Manpower Law accommodates the previous Constitutional Court Decision against the Manpower Law regarding payment of wages during bankruptcy or liquidation of an employer. When a company is bankrupt or liquidated, the Amended Manpower Law provides that the payment of employee’s outstanding wages are prioritized over payment to other creditors, including secured creditors’ claims, claims of state’s rights, auction houses, and public institutions established by the Government. Meanwhile the payment of other employees’ rights are paid in advance against all creditors except secured creditors.
- PAID LEAVE
Under the Amended Manpower Law, a long leave may be given by certain companies and it shall be governed under an employment agreement, a company regulation, or a collective work agreement.
Other provisions on paid leave regulated under the Manpower Law remain unchanged, including paid menstrual leave and maternity leave.
- TERMINATION OF EMPLOYMENT AND TERMINATION BENEFITS
Consistent with the Manpower Law, the Amended Manpower Law does not recognize the concept of termination-at-will. Therefore, employers may not dismiss employees without cause. In the event of employment termination and the employee does not accept the termination, Article 151 of the Amended Manpower Law requires the parties in dispute to go through the dispute settlement procedures (i.e., the bipartite negotiation, the tripartite mediation, and the court proceeding at the Labor Court) as regulated under Law No. 2 of 2004 dated January 14, 2004 on Industrial Relation Dispute Settlements.
Under the Amended Manpower Law, there are no longer multipliers of the termination benefits arising from termination of employment under specific circumstances (e.g., in the event of efficiency measures, mergers, acquisitions, changes of ownership, consolidations, spin offs, death, retirement, or prolong illnesses). We understand that these changes appear to be the most controversies and objection from the labor workforce, since these entitlements in the event of employment termination are reduced.
The formula to calculate the amount of termination pay and service pay under the Amended Manpower Law remains the same with that of the Manpower Law. However, we note that the Amended Manpower Law omits one of the components of the compensation pay which was previously regulated under the Manpower Law, namely the ‘housing, medical, and health care allowance’ which was determined to be 15% of the total amount of the severance and the service pay.
While there are no multipliers of severance pay and service pay like in the Manpower Law, the Omnibus Law introduces a new social security program called the job loss security/coverage. The job loss security/coverage will be organized by the Social Security Administrator Agency for Manpower (BPJS Ketenagakerjaan) and the Government. The program will provide benefits for employees whose employment is terminated in the form of cash, job training, as well as access to job market information. This additional security/coverage is subject to payment of a premium or contribution to BPJS Ketenagakerjaan. It is unclear yet who shall be responsible for the premium or contribution for the job loss security/coverage.
Further provisions on the job loss coverage/security will be stipulated in a Government Regulation. So it remains to be seen how the job loss security/coverage will be implemented and paid to the employees whose employment is terminated.
***
October 8, 2020
Copyright © 2020 AKSET. All rights reserved.
Newsflash on Amendment of Manpower Law
Omnibus Law Finally Passed
On October 5, 2020, the House of Representatives finally passed the long-awaited Job Creation Law or what is publicly known as the Omnibus Law, amidst controversies during the drafting process.
At the time this newsflash is issued, this Job Creation Law is still undergoing final redactional review and promulgation process with the State Secretary. The public has yet to obtain the final version of the Law at this moment. The discussion of this newsflash is based on the final draft of the Job Creation Bill circulated publicly on October 5, 2020. We expect some changes in the Law is enacted, but no substantial changes should be made to the Law.
In total, based on this latest draft, the Omnibus Law amends 76 existing laws. Among the numerous amended laws, some of the most notable amendments are laws on capital investment, limited liability companies, and manpower. The complete list of the amended laws may be found in the following link.
In addition to the amendment of laws, the Omnibus Law stipulates segmentation for licensing based on the risk profiles of business activities. This is intended to simplify licensing the process and doing business in Indonesia, including the institutionalization of micro and small enterprises.
Further, in relation to taxation matters, Government of Indonesia originally intended to pass a separate “omnibus law” on taxation. However, this newly-enacted Job Creation Law already includes amendments on taxation laws (i.e., the Law on General Provisions of Taxation, the Law on Income Taxes, and the Law on Value Added Taxes and Sales Taxes for Luxury Goods). It remains to be seen whether the omnibus law on taxation will still be discussed and passed separately by the House of Representatives.
Please find below the key provisions in the Omnibus Law. We will issue a series of newsflashes with in-depth discussion on each of these items.
- Risk-based Business Licensing
The Omnibus Law introduces a new segmentation of business licensing based on risk profiles of the business namely: low, medium, or high risks. The risks are determined based on an evaluation of the health, safety, environment, resources utilization and management, and volatility of the businesses.
Based on the risk profiles of the businesses, the documents required for the relevant business are as follows.
| Risk | Business Licensing Document |
| Low | A Business Identification Number (Nomor Induk Berusaha or “NIB”) |
| Medium-low | a. An NIB; and
b. A Statement of certification standard by the business actor. |
| Medium-high | a. An NIB; and
b. Fulfillment of certification standards. |
| High | a. An NIB; and
b. A License. |
We expect the implementation of this risk-based business licensing to be incorporated in the Online Single Submission (“OSS”) system.
- Transitional Clauses
In light of the issuance of this Omnibus Law, existing Business Licenses will still be valid until the end of their validity period, and any issued Business License may be adjusted in accordance with the Omnibus Law.
Under the Omnibus Law, the implementing regulations should be issued in three months from the date of the Law’s promulgation. Existing implementing regulations will still be valid as long as the provisions therein do not contradict those of the Omnibus Law, and they shall be conformed within three months.
- Amendments of Capital Investment Law
The Omnibus Law amends the Capital Investment Law to include specific business lines that are closed for capital investment. Other than these closed business lines and activities that may only be carried out by the Central Government, all business lines are open for investment. We expect the new negative list of investment to be issued in the near future following the enactment of the Omnibus Law.
- Amendments of Company Law
Under the amendment of the Company Law in the Omnibus Law, there is no longer a minimum requirement for the authorized capital. The amount of the authorized capital shall be agreed upon by the founders of the company and 25% of such authorized capital shall be issued to and paid-up by the shareholders.
It is important to note that under the current BKPM regulations, foreign investment companies are still required to have the issued and paid-up capital of at least Rp2.5 billion.
Another new concept introduced under the Omnibus Law is the simplification of the company establishment for micro and small businesses. Micro and small companies may be established by a sole shareholder pursuant to an establishment statement. With this provision, micro and small businesses may be institutionalized with more lenient requirements, thus creating a separation of liability between the company and the individual owner.
- Amendments of Manpower Law
The Omnibus Law amends various provisions under the Manpower Law, among them are treatment on terms of fixed-term employment agreement, outsourcing rules, and employment termination benefits.
The amendments of the Manpower Law under the Omnibus Law no longer stipulate the maximum period of a fixed-term employment agreement, although the Omnibus Law still states that fixed-term employment agreements shall not be entered into for works that are permanent in nature. Further provisions on fixed-term employment agreements will be stipulated under a Government Regulation.
The amendments to the Manpower Law remove subcontracting from the Manpower Law, and do not set out the types of works that may be outsourced to outsourcing companies, while still acknowledging outsourcing arrangement itself. However, because the Minister of Manpower Regulations currently in effect still contain the said conditions (e.g., that outsourcing may only be for supporting activities separate from main business activities), it is unclear whether these conditions will be considered a contradiction that will require an adjustment to conform with the Omnibus Law. Therefore, it remains to be seen whether the Minister of Manpower will issue new regulations on outsourcing due to changes in outsourcing rules in the Omnibus Law.
Other notable amendments under the Manpower Law are changes on employment termination benefits. Under the Omnibus Law, there is no longer multiplier for termination benefits in relation to termination of employment under specific circumstances (e.g., in the event of efficiency or merger of companies). We understand that these changes are what causes the most controversies and objection from labor workforce, since these have greatly reduced their employment termination entitlements in cases of mergers, efficiencies, or death.
- What to Expect
Despite its intention to ease licensing process and doing business in Indonesia, various matters under the Omnibus Law still remain to be further stipulated to ascertain that these ideas work for all stakeholders across the board.
***
October 7, 2020
Copyright © 2020 AKSET. All rights reserved.
Omnibus Law Finally Passed
DKI Jakarta Extends PSBB for Two Weeks
On September 11, 2020, the Governor of DKI Jakarta re-imposed the Large-Scale Social Restrictions Activities (Pembatasan Sosial Berskala Besar or “PSBB”) through the Governor Decree No. 959 of 2020 on the Entry into Force of Large-Scale Social Restrictions in the Management of the Corona Virus Disease (Covid-19) in the DKI Jakarta Province (the “Decree”), which initially is effective only until September 27, 2020. However, the Decree stipulates that the PSBB measure may be extended in the event that new cases of Covid-19 keep significantly increasing.
On September 24, 2020, the Governor of DKI Jakarta announced that the PSBB policy will be extended to avoid potential escalation in Covid-19 cases. Therefore, as governed under the Decree, the PSBB policy will continue from September 28, 2020 until October 11, 2020.
Similar to the initial PSBB, in implementing this PSBB extension, the DKI Jakarta Government refers to the Governor of DKI Jakarta Regulation No. 33 of 2020 dated April 9, 2020 regarding the Implementation of Large-Scale Social Restrictions in the Management of the Corona Virus Disease (Covid-19) in the DKI Jakarta Province as amended by the Governor of DKI Jakarta Regulation No. 88 of 2020 dated September 11, 2020 (collectively referred to as the “Regulation”).
In essence, the Regulation governs the following key provisions:
- Religious Activities at Places of Worship
For religious activities carried out at places of worship, the maximum attendance shall be 50% (fifty percent) of the full capacity.
- Workplaces
‘Non-essential’ workplaces must be limited to no more than 25% (twenty five percent) of the full capacity. If an employee gets infected with the Covid-19, all activities at the workplace must be discontinued for at least 3 x 24 hours.
- People Movement Using Public and/or Private Transportation
All mass public transportations are limited to the maximum capacity of 50% (fifty percent) of the full capacity.
In addition to the above, the Governor of DKI Jakarta issued Decree No. 979 of 2020 dated September 22, 2020 on Controlled Isolation Places owned by the DKI Jakarta Province as Management of the Corona Virus Disease (Covid-19) (“Decree 979/2020”). In Decree 979/2020, the Governor of DKI Jakarta declares i) the Jakarta Islamic Centre, ii) Graha Wisata Taman Mini Indonesia Indah, and iii) Graha Wisata Ragunan as controlled isolation places for those who contracted Covid-19 in DKI Jakarta.
Given that DKI Jakarta has new Covid-19 cases every day and even is predicted to reach 20,000 active cases in early November, there is a high possibility that the PSBB policy may be extended again. We will continue to monitor the development closely.
***
September 25, 2020
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Minister of Manpower Issues Guidelines for Business Continuity Plans
In light of the COVID-19 pandemic, on September 18, 2020, the Minister of Manpower (the “MOM”) issued her Decree No. 312 of 2020 on the Guidelines for the Drafting of Business Continuity Plans (the “BCP”) in Facing a Disease Pandemic (the “MOM Decree”). The MOM Decree is intended to provide guidance for companies to prepare their BCPs to protect their business continuation from the impact of the pandemic and to prevent the spread of the virus in their companies. Companies are expected to prepare the BCP tailored to their specific businesses.
As the MOM Decree is a guidance, there is no sanction if a company does not have a BCP. There is no obligation for companies to submit their BCPs to any governmental authority. However, companies are encouraged to involve the labor unions and coordinate with the Labor Inspector (Pengawas Ketenagakerjaan) in preparing the BCP.
Under the MOM Decree, there are seven stages in preparing a BCP, i.e.:
- recognizing business priorities;
- identifying the pandemic risks;
- planning the mitigation for the pandemic risks;
- identifying the response to the impact of the pandemic;
- designing and implementing the BCP;
- communicating the BCP; and
- testing the BCP.
We will briefly discuss the BCP preparation stages below.
- Recognizing Business Priorities
In recognizing its business priority, a company shall first determine its main products/services. The company shall then identify the core business activities that must be conducted to produce such main products or to provide the main services. This step includes identifying the manpower required for the business activities and, in case of their absence, whether they can be replaced or filled in by other employees.
- Identifying Pandemic Risks
Following the first step, the company shall identify the risks of the pandemic for the identified components. The company shall map scenarios of possible threats, both internal and external, that may disrupt the business continuity. These identified threats shall be scored based on their probability and severity (e.g., from scale of 1 to 5).
The company shall also map vulnerability points in each identified scenario, for example, vulnerability in manpower, material, facility, and finance. Subsequently, the company shall analyze its capability in controlling each threat, according to their level of priority.
- Planning Mitigation for Pandemic Risks
In preparing the mitigation plan for the pandemic, a company shall consider preparing standard operational procedures (the “SOP”), implementing flexible work, securing the supply chain, preparing a communication team, reassess labor policy (such as policy on business travel, overtime, etc.), and occupational health and safety.
In planning the mitigation, the company shall determine the level of an acceptable risk for each threat, planning the actions required to mitigate such risk, set out a schedule for the action plan, determine resources needed to carry out the actions, and appoint the relevant personnel for each action.
- Identifying the Response to Impact of Pandemic
The company shall first identify the events that will trigger the response, the target response, the responding action based on the mitigation plan and the SOP, the required resources, and the person in charge.
- Preparing and Implementing BCPs
Based on the information identified at the previous stages, the company shall prepare the BCP in a matrix. A designated team may be formed specifically for the preparation of the BCP. It is also suggested that employees be involved in the preparation of the BCP and that the BCP sets out clear definition of the management’s and the employees’ responsibilities.
- Communicating BCPs
After the BCP is stipulated, it shall be communicated internally (to all employees and management) and externally (to customers, suppliers, etc.).
- Testing BCPs
The BCP may be tested in the form of simulation, drills, etc. The testing may be done periodically to keep the BCP updated on new issues that may occur from time to time.
***
September 24, 2020
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Covid-19 Prevention and Control Protocols for Offices in Jakarta
Approximately 5 months after the Covid-19 outbreak in Jakarta, the Head of the Service Office of Manpower, Transmigration, and Energy of Jakarta Province Agency (“Head of Manpower Agency”) enacted Decree No. 1986 of 2020 dated August 28, 2020 on Covid-19 Prevention and Control Protocols in Private Offices, State Owned Enterprises, Regional Owned Enterprises, and Places of Work (the “Decree”). The Decree implements Article 8(9) of Governor of Jakarta Regulation No. 79 of 2020 dated August 19, 2020 on the Disciplinary and Law Enforcement Implementation of Health Protocols as Prevention and Containment Efforts of the Corona Virus Disease 2019 (the “Governor Regulation”).
- Covid-19 Prevention and Control Protocols
Pursuant to the Decree, the Covid-19 prevention and control protocols (collectively, the “Protocol”) in private offices, state owned enterprises, regional owned enterprises, and places of work shall be carried out by these following measures:
- To form of a Covid-19 Handling Team which consists of the leader of the Company, the representatives of the employees, the work safety and health officer, the medical personnel, and the security guard by making a Statement Letter issued by the head of the Company (the “Handling Team”);
- The Handling Team shall make reports in writing through bit.ly/covid19perusahaan directed to the Manpower Agency if there is an employee that has a close contact with a Covid-19 patient, became a suspect of Covid-19, a probable of Covid-19, a confirmed patient of Covid-19, or recently returned from travel;
- To limit the number of people present at the same working place at the same time by no more than 50% of the regular capacity;
- To require each employee and visitor to wear a mask and any other self-protection equipment as necessary (i.e., hand gloves and/or face shields);
- To clean and disinfect the office space periodically using the proper cleaner and disinfectant;
- To measure the body temperature of each person who enters the work place;
- To provide a separate room to observe an employee with the Covid-19 symptoms;
- To provide the hand sanitizer at each entrance and in each room;
- To provide hand washing facilities;
- Not to terminate the employment of any employee who is undergoing self isolation and continue to provide the basic rights to such employee;
- To conduct periodic health assessments to all employees to ensure that they are infected by the Covid-19 and to require visitors to complete the Self-Assessment Form;
- To apply a physical distancing of at least 1 (one) meter;
- To arrange the utilization of the employees facilities to avoid large gatherings (i.e., the elevators, praying facility, canteens, sports facilities, etc.);
- To maximize the use of technology in carrying out work activities;
- The Handling Team shall supervise the health of the employees proactively;
- To impose sanctions on employees that do not implement the Protocol;
- To encourage employees to use personal transportation;
- To provide supporting facilities for employees who use a bicycle to work; and
- To suspending the company’s activity for cleaning and disinfecting for 3x24 hours if an employee and/or a member of society in the company is confirmed positive of the Covid-19.
- Sanctions
Based on Article 8(5) of the Governor Regulation, any violation of the Protocol by the employer, a manager, an operator, or a person in charge of any office, work place, business place, industrial site, hotel or any other similar accommodation or tourist attraction, shall be imposed with administration sanctions in the form of temporary closing for up to 3x24 hours. Further, if such person repeats the violation of the Protocol, then such person may subject to the following penalties:
- First repetition, Rp50,000,000 (fifty million Rupiah) penalty;
- Second repetition, Rp100,000,000 (one hundred million Rupiah) penalty;
- Third repetition, Rp150,000,000 (one hundred fifty million Rupiah).
The sanction imposition shall be carried out by Satpol PP, the Manpower Agency, the Tourism and Creative Economy Agency, the Industry, Trade, Cooperation, Small and Mid-Sized Enterprises Agency. These Agencies may be accompanied by regional authorities, police and/or military force.
As of today, there a number of companies were temporarily closed by the Governor of Jakarta due to the violation of the Protocol.
- Reporting Obligation
Other than the reporting obligation stated on point (b) above, a company must submit a report on the implementation of the Protocol through bit.ly/bekerja-kembali which consists of, among others, the check list of whether or not each item of the Protocol is completed.
***
September 15, 2020
Copyright © 2020 AKSET. All rights reserved.
DKI Jakarta Re-Imposes Stricted PSBB After Record Of COVID-19 Infections Rise In Cases; Health Protocols In Workplaces
Since June 2020, DKI Jakarta has implemented the transitional phases of the implementation of Large-Scale Social Restrictions Pembatasan Sosial Berskala Besar – THE “PSBB”) by easing the restrictions put in place under the PSBB and allowing certain activities to resume in order to maintain the productive socio-economic activities.
However, the Governor of DKI Jakarta decides to discontinue the transitional phases of the PSBB and re-impose the stricter PSBB. This decision is taken in order to reduce the spread of the Corona Virus Disease (Covid-19) as the infection cases in DKI Jakarta continue to surge. Under the Governor Decree No. 959 of 2020 dated September 11, 2020 on the Entry into Force of Large-Scale Social Restrictions in the Management of the Corona Virus Disease (Covid-19) in the DKI Jakarta Province, the stricter PSBB measures are effective as of September 14, 2020 until September 27, 2020 and may be further extended if necessary.
Unlike the transitional PSBB, the Governor of DKI Jakarta sets out the restrictions of the PSBB in DKI Jakarta the Governor Regulation No. 88 of 2020 regarding Amendments of Regulation No. 33 of 2020 on Implementation of Large-Scale Social Restrictions in the Management of the Corona Virus Disease (Covid-19) in the DKI Jakarta Province (the “Regulation”).
In addition, the implementation of the PSBB under the Regulation refers to Governor of DKI Jakarta Regulation No. 79 of 2020 dated August 19, 2020 on the Implementation of Discipline and law Enforcement of Health Protocols as Endeavor of Prevention and Control of Covid-19 (the “Protocols”).
We set out below the key provisions of the amendments on the implementation of the PSBB based on the Regulation.
- ‘Non-Essential’ Businesses to Limit Workplaces at 25% Capacity
All “non-essential” businesses are required to temporarily limit their activities at the workplaces. This limitation is conducted by implementing mechanism to work from home for the employees. If the work from home mechanism cannot be conducted, the businesses shall limit the number of people who are at workplaces at any time to be not more than 25% (twenty five percent) of the total number of the people at workplaces.
- ‘Essential’ Businesses May Operate with Certain Restrictions
The Regulation stipulates certain “essential” businesses which are exempted from the PSBB, as follows:
- foreign country representative offices and/or international organizations carrying out diplomatic functions;
- state/regional-owned enterprises participating in the handling of Covid-19 and/or fulfillment of basic needs;
- workplaces in the following sectors:
- health;
- food/beverage;
- energy;
- communication and information technology;
- finance;
- logistics;
- hospitality/hotel activities;
- construction;
- strategic industries;
- basic services, public utilities and industries which are deemed certain vital national objects; and/or
- daily needs.
- local and international non-governmental organizations that engage in the disaster reliefs and/or social sectors.
The exempted businesses above are still subject to the Protocols (which are briefly discussed below).
- Health Protocols at Workplaces for ‘Non-Essential’ Businesses
In general, the ‘non-essential’ businesses shall implement the following measures in conducting the activities at workplaces:
- To establish the mechanism to work from home to all employees;
- To maintain that the service provided and/or business activities are still ongoing on limited basis;
- To maintain the productivity of the employees;
- To carry out the prevention measures of Covid-19 transmission in the workplaces, such as ensuring the workplaces areas are clean, conducting periodic cleaning, using cleansers and disinfectants, and closing access for any unauthorized person;
- To suspend the activities at the workplaces for at least 3x24 hours if there is any employee who is infected by the Covid-19;
- To maintain the safety at or around the workplace; and
- To provide assistance for any employee who is infected by Covid-19 as per the applicable regulations.
- Health Protocols at Workplaces for ‘Essential’ and ‘Non-Essential’ Businesses
Both ‘essential’ and ‘non-essential’ businesses shall comply with the Protocols, including the following:
- To establish an internal Covid-19 task force at workplaces which consists of the management, HRD department, Occupational Health and Safety (OHS) department, and health officers by issuing a decision of such establishment by the businesses;
- To monitor and update the development of information of Covid-19 in the workplaces and report in writing to the Government of DKI Jakarta through the established Covid-19 task force (as referred in point 1 above);
- To limit the number of people who are at workplaces at any time to be not more than 50% (fifty percent) of the total number of the people at workplaces (except for the ‘non-essential’ businesses, the limit is 25% capacity);
- To require employees to wear masks;
- To ensure the entire working area is clean and hygiene by conducting perioding cleaning using cleaner and disinfectant;
- To perform a body temperature check before entering the workplaces;
- To provide hand sanitizer;
- To provide facilities for hand washing with running water and soap;
- To not terminate the employment of an employee who undergoes self-isolation/self-quarantine due to Covid-19;
- To ensure that employees who come for work are not infected by the Covid-19;
- To ensure the physical distancing with a minimum distance of 1 (one) meter between persons in every work activity;
- To avoid work activities which may cause a crowd;
- To proactively conduct employees’ health monitoring;
- To implement the Covid-19 prevention protocols;
- To impose a sanction on employees who do not implement Covid-19 prevention protocols;
- To publish the Covid-19 prevention protocols.
Our previous workplaces guidance set out in our Newsflash (please check: https://aksetlaw.com/news-event/covid19/workplaces-guidance/) remain effective unless changed in the above.
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September 14, 2020
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Bank Indonesia Loosens the Mandatory Fulfilment of Giro Reserve Requirements in Rupiah
On May 1, 2020, Bank Indonesia amended the provisions of mandatory fulfilment of Giro Reserve Requirements (Giro Wajib Minimum — the “GWM”) in Rupiah for Conventional Commercial Banks (Bank Umum Konvesional — collectively, “BUK”), Sharia Commercial Banks (Bank Umum Syariah — collectively, “BUS”) and Sharia Business Units (Unit Usaha Syariah — collectively, “UUS”) by enacting the Members of the Board of Governors of Bank Indonesia Regulation Number 22/10/PADG/2020 on Giro Reserve Requirements in Rupiah and Foreign Exchange for Conventional Commercial Banks, Sharia Commercial Banks, and Sharia Business Units effective on May 1, 2020 (“PADG 22/2020”). PADG 22/2020 is the fifth amendment of the initial Members of the Board of Governors of Bank Indonesia Regulation Number 20/10/PADG/2018. PADG 22/2020 entered into force as of May 1, 2020.
PADG 22/2020 is an implementing regulation of Bank Indonesia Regulation Number 22/3/PBI/2018 dated July 16, 2018 on Giro Reserve Requirements in Rupiah and Foreign Exchange for Conventional Commercial Banks, Sharia Commercial Banks, and Sharia Business Units as lastly amended by Bank Indonesia Regulation Number 22/10/PBI/2018 dated October 1, 2018.
The issuance of PADG 22/2020 is Bank Indonesia’s effort to constantly maintain and increase the availability of Rupiah liquidity in conventional and sharia banking from the impact of domestic economic growth slowdown.
Under PADG 22/2020, Bank Indonesia loosens the mandatory fulfilment of the GWM amount in Rupiah for BUK, BUS and UUS. PADG 22/2020 also amends provisions which, among others, loosen the requirement for BUK to be eligible in obtaining giro services from Bank Indonesia, provide an adjustment of the calculation that reflects the change of the mandatory fulfilment of GWM for BUK, BUS, and UUS that receives short-term liquidity loan or financing, as well as clarify the mandatory fulfilment of GWM on a daily basis for BUK and BUS performing merger and consolidation.
- LESS STRINGENT GWM REQUIREMENTS IN RUPIAH
PADG 22/2020 has lowered the GWM percentage in Rupiah at the average of 3.5% of Third-Party Fund (Dana Pihak Ketiga — “DPK”) in a BUK in Rupiah during a particular report period. Previously the requirement was at the average of 5.5% of DPK in a BUK. The calculation of the foregoing GWM shall be fulfilled at 0.5% on a daily basis. This is a more lenient specification from the previous 2.5% daily requirement based on balance sheet of a BUK’s clearing account in Rupiah at Bank Indonesia. Meanwhile, the average of calculation basis of the foregoing GWM still remain the same at 3% based on the average of balance sheet of a BUK’s clearing account in Rupiah at Bank Indonesia. Similar relaxation of GWM percentage also applies to BUS and UUS.
In connection with giro services (jasa giro), the previous regulations provide that Bank Indonesia may grant giro services for BUK every day to a particular portion of the fulfillment of obligation of GWM in Rupiah, provided that such BUK fulfills the ratio of GWM in Rupiah more than or equal to 5.5%. PADG 22/2020 lowers this requirement to be at 3.5%.
Similar with the previous regulations, BUK that receive any short-term liquidity loan and BUS that receive any short-term liquidity sharia financing are not subject to the mandatory fulfilment of GWM at an average. Such BUK and BUS are only obligated to comply with the fulfilment of GWM in Rupiah on a daily basis. However, PADG 22/2020 loosens the requirement for GWM fulfilment on a daily basis from the previous 5.5% and 4% respectively to 3.5% of the respective DPK in Rupiah.
- Clarification of GWM calculation for BUK and BUS in mergers or consolidations
PADG 22/2020 clarifies the calculation for the relaxation of daily GWM percentage in Rupiah for BUK and BUS performing merger or consolidation. The calculation for the foregoing relaxation shall be 1% on a daily basis. If the daily mandatory fulfilment of GWM in Rupiah is less than 1%, the relaxation upon daily mandatory fulfillment of GWM in Rupiah for such BUK and BUS shall be fulfilled by the surviving bank in the merger or consolidation with the percentage of the stipulated daily mandatory fulfilment of GWM, which is 0.5% of their respective DPK.
Alongside the aforementioned changes, PADG 22/2020 amends the details of the calculations as set out under Attachments I, III, V, VI, VIII, X, XI and XII of PADG 22/2020, together with a brief examples to calculate the GWM amount.
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September 11, 2020
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Government to Grant Subsidy for Workers Affected by COVID-19
Amidst the COVID-19 pandemic, the Minister of Manpower (the “Minister”) issued the Minister Regulation No. 14 of 2020 dated August 14, 2020 on the Guidelines for the Granting of Government Support in the Form of Salary/Remuneration Subsidy for Workers/Manpower in Handling the Impact of Corona Virus Disease 2019 (COVID-19) (the “Minister Regulation”).
Based on the Minister Regulation, the Government will grant support for eligible workers, in the form of salary/remuneration subsidy (the “Social Support”), in the amount of Rp600,000 (six hundred thousand Rupiah) per month for four months. The Social Support is intended to protect, sustain, and improve workers’ economic capability during the COVID-19 pandemic.
We set out below the highlights of the Minister Regulation.
- Criteria of Eligible Workers
To be considered eligible for the Social Support, a worker must fulfill the following requirements:
- an Indonesian citizen;
- is registered as an active member of the manpower social security program of Manpower Social Security Operating Body (“BPJS Ketenagakerjaan”), evidenced with a membership card number;
- receives salary/remuneration;
- his/her BPJS Ketenagakerjaan membership is valid until June 2020;
- pays contribution based on salary/remuneration of less than Rp5,000,000 (five million Rupiah), based on the report submitted by the employer to BPJS Ketenagakerjaan; and
- owns an active bank account.
The Government will grant the Social Support based on (i) the number of eligible workers, and (ii) budget ceiling availability.
If an employer provides falsified data in relation with the workers’ salary/remuneration, such employer shall be subject to sanctions in accordance with the prevailing laws and regulations.
- Procedures for the Granting of the Social Support
The information of the Social Support recipient candidates are collected from the data of active participants of BPJS Ketenagakerjaan. Hence, workers are not required to submit any application in order to be granted the Social Support. The BPJS Ketenagakerjaan will independently conduct verification and validation of such candidates in accordance with the stipulated criteria.
Based on unofficial statement of the President Director of BPJS Ketenagakerjaan as published on the news, BPJS Ketenagakerjaan is currently validating and verifying the data of eligible workers through their bank account and BPJS Ketenagakerjaan membership.After the verification and validation is completed, BPJS Ketenagakerjaan will provide a list of recipient candidates to the Minister.
The determination of the eligible workers shall be made by the Budget User Authorizer (Kuasa Pengguna Anggaran or KPA) which refers to the official in Directorate General of Industrial Relation Development and Manpower Social Security appointed by the Minister.
The Social Support will be distributed by the State Treasury Service Office through an appointed government bank directly to the recipients’ bank account. The Social Support distribution will be carried out in phases.
If a recipient turns out to be ineligible yet already received the Social Support, then he/she must return such Social Support to the state treasury.
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September 11, 2020
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Government Relaxes Premia for Manpower Social Security Programs During COVID-19
As an attempt to ensure the continuity of businesses during the Covid-19 pandemic, the Government relaxes the payment of premia for the Manpower Social Security Programs with the issuance of Government Regulation No. 49 of 2020 dated August 31, 2020 on Adjustments For Premia of Manpower Social Security Programs During Non-Natural Disaster Of Corona Virus Disease 2019 (COVID-19) (“GR 49/2020”). GR 49/2020 is effective as of September 1, 2020. The salient provisions of GR 49/2020 are discussed below.
Under GR 49/2020, the relaxation is as follows:
(i) the deferment of the premium payment deadline from the 15th of a month to the 30th of the month;
(ii) 99% (ninety nine percent) deductions of the Work-Related Accident Security (Jaminan Kecelakaan Kerja — “JKK”) premium and the Death Security (Jaminan Kematian — “JKM”) premium; and
(iii) partial postponement of Pension Security (Jaminan Pensiun “JP”) premium payment.
The relaxation above is valid from August 2020 until January 2021 and is applicable for employers, non-wage recipient participants and wage recipient participants (as applicable) who have registered their Manpower Social Security programs before August 2020.
The deductions and the postponement will be granted if the JKK and JKM premia are paid until July 2020. Any person who registers after July 2020 shall pay the normal premia for the first two months and will be granted deduction on their third month premia until January 2021.
In relation to postponement of partial payment of the JP premium, 99% of the premium of an employer’s portion may be deferred to May 15, 2021. The payment of the deferred premium must be made in full by May 15, 2022. The eligibility for this postponement differs based on the size of an employer. Medium-sized and Large Enterprises (Usaha Menengah dan Besar — “UMB”) are eligible for such postponement only if their production, distribution, or main business activities are disrupted due to Covid-19 and result in a decrease in monthly sales or income turnover of more than 30% (thirty percent). The companies must have registered their employees as participants before August 2020 and the companies have made the JP premium payment until July 2020.
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September 10, 2020
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