Indonesia: Implementation of the Job Loss Security Programme

The Government has revised provisions under the Government Regulation No 37 of 2021 on the Implementation of Job Loss Security Programme (“GR 37/2021”) by issuing new Government Regulation No 6 of 2025 on the amendment of GR 37/2021 (“GR 37/2021”). These amendments not only refine the framework of the Job Loss Security Programme but also reaffirm the role of other key social security schemes administered under the national system, namely; National Health Insurance (Jaminan Kesehatan Nasional or JKN); Work Accident Security (Jaminan Kecelakaan Kerja or JKK); Old Age Security (Jaminan Hari Tua or JHT); Pension Security (Jaminan Pensiun or JP); Death Security (Jaminan Kematian or JKM); and Job Loss Security (Jaminan Kehilangan Pekerjaan or JKP).

This regulation has introduced several key changes to the JKP framework, harmonising obligations and strengthening worker protection. Under previous regulation, only large and medium enterprises were required to enrol workers in JKN, JKK, JHT, JP and JKM, while micro and small enterprises had a slightly lighter obligation covering only JKN, JKK, JHT and JKM. The issuance of this amendment modifies this framework by clarifying that enrolment in JKN is mandatory for all enterprises regardless of size. In practice, this harmonises obligations and strengthens compliance, ensuring universal coverage under the national health insurance scheme.

Additionally, the JKP premium rate has been reduced from 0.46% to 0.36% of an employee’s monthly salary, easing the financial burden on employers while maintaining employee protection.

The regulations also stipulate the implementation of cash benefits to be received by employees who were laid off for a period of six months following their termination of employment (the “Benefit Period”), where the employee will receive 60% of their wage each month for that Benefit Period. However, if the employee earns above IDR5 million per month, they will instead only receive up to 60% of such threshold. Additionally, aside from the above cash benefits, employees may receive Job Training through the Manpower Information System.

To further protect the employees in special circumstances of termination, if a company goes bankrupt or ceases operations with contribution arrears of up to six months, workers’ JKP benefits will still be paid by BPJS, while the arrears and penalties remain the employer’s responsibility. In addition, the timeframe for filing claims has been extended from three to six months, giving employees greater flexibility in accessing their entitlements. Collectively, these reforms reflect the Government’s effort to balance employer obligations with stronger worker protections and broader access to social security benefits.

The regulation also tightens requirements regarding the proof of termination by mandating formal documentation, including acknowledgment of termination, industrial relations court stipulation, termination reports or binding court decisions.