To implement the National Social Security Agency program, the Indonesian government issued Government Regulation No. 46 of 2015 on the Management of the Old Age Security Program (“GR 46/2015”) on 30 June 2015. The Old Age Security Program was previously regulated under Government Regulation No. 14 of 1993 on Implementation of Workers Social Security Program (Jaminan Sosial Tenaga Kerja or Jamsostek) (“GR 14/1993”).
Old age security (Jaminan Hari Tua or “JHT”) is the benefit given to participants of the program paid altogether in cash. 1
Participants and Contribution
GR 46/2015 now categorizes participants of the JHT to consist of salary earners and non-salary earners, instead of only employer and employees under GR 14/1993.
Salary earners include employees at companies and individuals, as well as foreign workers working in Indonesia for more than 6 months.2 Meanwhile, non-salary earners include employers and any workers who do not fall within the salary earners category.3
For salary earners, the amount of contribution and its portion are the same with GR 14/19934 that is 5.7% of the monthly salary which is divided between employers for 3.7% and the employees for 2%.5
For non-salary earners, the contribution is to be paid in cash with a fixed amount categorized based on the levels of the non-salary earner’s income amount,6 as provided in the attachment of GR 46/2015.
Benefits and Collection
As with GR 14/1993,7 collectible benefits are calculated based on the sum of accumulated amount of the stored contributions recorded and the amount of yielded interests8
Under GR 46/2015, JHT’s benefit is collectible when the participant reaches the pension age, which is 56 years old, suffers a permanent defect or becomes deceased.9 As an exception to the requirements, JHT benefits can only be collected if the participant has participated for the period of at least 10 years for a certain limited amount.10
As a breakthrough, GR 46/2015 provides an opportunity for participants who have participated for at least 10 years to allocate their JHT benefits to housing ownership for a maximum 30% of JHT amount.11
Compared to GR 14/1993, participants have to wait longer to be able to collect their JHT benefits, which are 55 years of pension age or minimum participation of 5 years in JHT.12
The benefits for salary earners whose contracts are terminated and have less that 10 years participation in the program are only collectible when the participant has reached 56 years old.13
GR 46/2015 has raised some controversies. The government is currently considering a revision for GR 46/2015 in order to accommodate the enjoyment of benefits for participants who are no longer working due to early termination or expiry of working period, industrial disputes, as well as resignation without having to wait for the full 10 years.
1 Article 1(1) of GR 46/2015 ;
2 Article 4 (1) of GR 46/2015 ;
3 Article 4(3) of GR 46/2015 ;
4 Article 9(3) of GR 14/1993 ;
5 Article 16 of GR 46/2015 ;
6 Article 18 (1) of GR 46/2015 ;
7 Article 24 (1) of GR 14/1993 ;
8 Article 22 (2) of GR 46/2015
9 Article 1(1) of GR 46/2015, Article 22(1) of GR 46/2015 ;
10 Article 22(4) of GR 46/2015 ;
11 Article 22(5) of GR 46/2015 ;
12 Article 32(1) of GR 14/1993 ;
13 Article 26(3) of GR 46/2015