Indonesia Quarterly Regulatory Updates – February To April 2022 – Government Contracts, Procurement & PPP

Business Competition Supervisory Commission (Komisi Pengawas Persaingan Usaha or “KPPU“) No. 1 of 2022 on Business Competition Compliance Program (“KPPU Reg. 1/2022“)

Enforcement Date: March 24, 2022

• To increase compliance with the competition law, and to prevent monopoly and unhealthy business practices, KPPU has implemented a guideline on business competition compliance program (“Compliance Program“), in effect since 2016. KPPU Reg. 1/2022 is issued to accommodate the program implementation. Business actors that:




• 1. have joined the Compliance Program but have not been registered at KPPU; and

  
  

  2. have not joined the Compliance Program




• can register their relevant businesses to the Head of KPPU.




• Compliance Program contains: 1) Code of Ethics; 2) Compliance guide; 3) Socialization, training, or other activities regarding the program implementation. Business actors must report the implementation of their program to KPPU to be evaluated at KPPU hearings.




• If approved, KPPU will issue the Compliance Program Stipulation, which is valid for five years and can be extended.




• KPPU may relax the sanctions or fines against business actors who have registered their Compliance Program.

Minister of Manpower (“MoM“) Circular Letter No. M / 2 / HK.04 / IV / 2022 on Revocation of MoM Circular Letter No. M / 3 / HK.04 / III / 2020 on Protection of Workers / Laborers and Business Continuity to Prevent and Mitigate the Spread of COVID-19 (“MoM Circular Letter No. 2/2022“)

Enforcement date: April 6, 2022

• MoM Letter No. 2/2022 revokes MoM Circular No. M / 3 / HK.04 / III / 2020 on measures to protect workers and current businesses in the middle of Covid-19 situation, which are: 1) efforts to prevent the spread of Covid-19 cases in a workplace environment; 2) wage protection for workers during the pandemic (workers who are ODP or Person Under Observation, or those who are confirmed to have Covid-19 still maintain their rights to take leaves, receive their wages, and have their pays adjusted according to prior agreements). between the Company / Employer and the workers).




• As the pandemic has been under control through, among other measures, vaccination programs, easing of business restrictions, relaxation of business actors’ obligations, as well as easing of health protocols leading to the economic recovery, measures to protect workers and businesses are no longer applicable and are terminated.

MoM Circular Letter No. M / 3 / HK.04 / IV / 2022 on Implementation of Joint Leave by Companies (“MoM Circular Letter No. 3/2022“)

Enforcement date: 14 April 2022

• In MoM Circular Letter No. 3/2022, MoM elaborates the implementation of joint leave in a Company.




• Joint leave is a part of workers’ annual leave. Its implementation shall be based on the agreement between the Company and the workers and / or worker unions, company regulation, employment agreement, collective labor agreement, as well as other conditions in line with the company’s operational needs.




• The period of annual leave will be reduced when the workers take their leaves during the joint leave period. On the contrary, workers who work during the joint leave period will not have their leave period reduced, and they must receive their pays as they work on normal working days.

Letter of the Director-General of Development of Industrial Relations and Social Security of Workers No. 4/303 / HI.00.03 / III / 2022 on Notification Documents and Termination of Employment Relationship Report (“Letter No. 4/2022“)

Enforcement date: 11 March 2022

• Letter No. 4/2022 provides a standard of reporting mechanism regarding termination of employment in terms of the documents, employee’s response letter, application form to be submitted to the Manpower Office, and receipt issued by the Manpower Office.




• If the employment termination is unavoidable, the employer must notify the relevant workers and / or workers union with the reasons of termination, at least, 14 days before the termination. If the workers accept the termination, the employer must report it to MoM or the relevant provincial / local Manpower Office to obtain the official receipt.

Letter of the Social Security Agency for Employment No. B / 1409/032022 on Limits of Maximum Wages and Pension Benefits for the Year 2022 (“Social Security Agency Letter No. 1049/2022“)

Enforcement date: 1 March 2022

• According to the Central Bureau of Statistics (“Badan Pusat Statistik or BPS“), the inflation rate in 2021 is 1.87% and the growth of Indonesian Gross Domestic Product (“GDP“) in 2021 has increased by 3.69%. As a result, Manpower BPJS has adjusted the amount of: 1) minimum pension benefit to IDR 363,000 / month; 2) maximum pension benefit to IDR 4,357,900 / month; and 3) highest wage limit as the basis for insurance payment calculation to IDR 9,077,600 / month.




• The updated adjustments have come into effect since March 2022 payment period.