The Ministry of Manpower is still revising the policy regarding the requirements for the disbursement of Old Age Security (JHT) benefits as ordered by President Joko Widodo last February. Minister of Manpower Ida Fauziah said his ministry was still absorbing the aspirations of trade unions and labor unions.
“Following up on the President’s directives regarding the procedures for the requirements and payment of JHT that need to be simplified. Mrs. @idafauziyah reiterated that her ministry is currently processing the revision of Permenaker No. 2 of 2022,” wrote the Ministry of Manpower through the Twitter account @KemnakerRI, Wednesday (2/3).
The old regulations are still in effect, because the Minister of Manpower Regulation (Permenaker) Number 2 of 2022 will only take effect on May 4.
“The old Permenaker (No. 19/2015) is still in effect and is still the basis for fellow workers/laborers to claim JHT. No exception for those who have been laid off or resign, they can still claim JHT before retirement age,” wrote the @KemnakerRI account.
It is not clear whether the revision in question will reintroduce the provisions of the old regulation, but the Ministry of Manpower tweeted, “In principle, the provisions regarding JHT claims are in accordance with the old rules.”
The revision order came after the workers and workers balked at the rules for disbursing JHT as stipulated in the Minister of Manpower Regulation Number 2 of 2022 concerning Procedures and Terms of Payment of Old Age Security Benefitswhich was promulgated last February 4th.
In the Permenaker, participants can only withdraw JHT when entering retirement at the age of 56 years, passing away, or experiencing permanent total disability. However, in the previous regulation, Permenaker Number 19 of 2015program participants who resign from work or are affected by termination of employment (PHK) can immediately claim JHT with a waiting period of one month after being declared jobless.
The anger of the workers towards the change in regulations is natural, said a lecturer in Industrial Relations Management at Parahyangan Catholic University, Indrasari Tjandraningsih.
“The Minister of Manpower Regulation (Number 2 of 2022) is not sensitive to the general economic conditions of workers,” Indrasari told VOA by telephone (28/2).
According to him, the policy-making process should not be separated from the real situation of the subjects who will be affected by the policy.
According to the Central Statistics Agency (BPS), as of August 2021, there were 10.32 percent of the working age population (21.32 million people) who were affected by COVID-19, either being unemployed (1.82 million people) or non-working force (BAK). (700 thousand people), while not working (1.39 million people) to experience a reduction in working hours (17.41 million people).
Not only declining incomes, the pandemic conditions also require them to allocate extra spending to prevent, protect, and treat COVID-19. In the midst of the economic downturn, Indrasari assessed that the decision to change policy was taken at the wrong time.
“I suggest that it be postponed, for example in the next two or three years, when the economy is much more stable,” added the labor researcher at the AKATIGA Center for Social Analysis.
JHT Misguided and Wrong Government Strategy
The new Permenaker that was passed last February is intended to replace the previous Permenaker which was deemed “no longer in accordance with the development of the protection needs of JHT participants,” as written in the body of the regulation.
The amendment returns the JHT provisions to be as stated in Law Number 40 of 2004 concerning the National Social Security System (SJSN).
According to the advocacy coordinator of BPJS Watch, Timboel Siregar, the government wants to restore the procedures for disbursing JHT to match its original purpose, namely so that participants can receive large amounts of fresh funds when retiring, which can be used for various things including starting a business, so they can avoid poverty. in old age. This can complement the function of pension insurance as another form of social security, where participants receive monthly benefits to maintain purchasing power and ensure that the “kitchen remains full,” said Timboel.
He noted that the initial ideals of JHT have become ambiguous since the issuance of the Minister of Manpower Regulation No. 19 of 2015. Many workers claim JHT immediately after losing their job – not in old age.
“Because it’s been a habit from 2015 until now, (after being hit by) layoffs, take (JHT), so it’s difficult to return to the khitah, to the philosophy,” said Timboel.
The misguided use of JHT, which he called a “solution to get cash,” was overcome by the government by launching a Job Loss Guarantee (JKP) scheme that could be claimed by participants affected by layoffs.
However, what happened last February, according to him, was a mistake in the government’s strategy. The Ministry of Manpower should have socialized the JKP scheme and the nature of the old-age insurance before announcing changes to the provisions for disbursing JHT benefits, said Timboel.
“So, the socialization of JKP is longer, then the JKP is inherent, it has become something that many people know. Finally, later, ‘oh, okay, if that’s the case, we’ll save JHT, then we’ll get JKP,’” he said. “Well, it’s the other way around. Permaneker Number 2 of 2022 has been released, the JKP has not been released,” he said.
JKP itself is a new social security program from the government that serves as a cushion for participants who have been laid off while looking for new jobs. The benefits provided are in the form of cash, access to job market information and job training. The money is given for six months, which is 45 percent of the last basic salary for the first three months and 25 percent for the last three months, with an upper salary limit of IDR 5 million.
In contrast to JHT, whose funding comes from participant and employer contributions, JKP is financed entirely by the government by composing the contributions of the Occupational Safety and Death Security.
Timboel hopes that the government’s revision of the JHT rules will not necessarily sacrifice the mandate of the law which makes JHT a guarantor of the welfare of workers in old age.
What’s Old Age Security Like in the US?
There are a variety of old-age benefits programs for workers in the US, from mandatory to elective.
Social Security is an insurance program administered by the US federal government that is mandatory for workers in America, one of the purposes of which is to provide pension insurance. Contributions are taken from the salaries of employees and employers.
“What we pay as employees later is equated dollar to dollar by the company and it all goes into the fund” Social Security that,” said Lidya Borchert, financial advisor at Northwestern Mutual.
New participants can claim their monthly benefits at the age of at least 62 years and have contributed for at least 10 years. If participants want to get a bigger monthly benefit, they can wait until full retirement age, around 65-67 years, before starting to disburse the benefit.
In addition to the participants themselves, their husband/wife, children, to the participant’s ex-husband or ex-wife can claim the pension benefits as long as certain conditions are met.
Besides Social Securityanother old-age guarantee popular with US workers is the 401K.
Unlike Social Security, 401K is an optional retirement savings program sponsored by a company or employer. Workers can register to allocate a portion of their salary to the program’s investment account, followed by the employer’s contribution, which can choose to equal that amount or only part of it. Participants can then choose the investment option they want to participate in, usually in the form of mutual funds.
Participants can begin claiming 401K benefits at least at age 59.5 or when they meet the Internal Revenue Service (IRS) criteria, the US federal tax agency, such as total permanent disability.
However, 401K participants can withdraw their retirement savings before the specified age subject to an additional 10 percent distribution tax, unless they meet certain criteria set by the IRS.
According to Lidya, the old-age insurance program is an elective one usually taken by participants to repay the benefits social security whose numbers he judged were sometimes inadequate.
“Social Security It’s not enough for their own life, actually, because it depends on our distribution (contributions), not all of them get the same,” he concluded.
For information, since the beginning of the COVID-19 pandemic, the policy of imposing additional distribution tax on 401K participants who wish to withdraw benefits before retirement age has been suspended in order to help participants affected by the economic crisis caused by COVID-19.
Meanwhile, if workers in America lose their jobs through no fault of their own and meet certain requirements, they are entitled to unemployment benefits from the US Department of Labor. The unemployment insurance program is a joint program between the state government and the US federal government.
Workers can register with the state unemployment insurance agency where they work for cash benefits. Usually, the disbursement process takes two to three weeks after registration.
Benefits vary by state, ranging from $200 to $700. Usually, the allowance is given within six months, although it can be extended when an economic crisis occurs, such as due to the COVID-19 pandemic. [rd/ab]