Late THR Payments – Penalties and Consequences

The Ministry of Manpower has regulated on Surat Edaran (SE) M/6/HI.00.01/V/2020 that the disbursement of religious days allowance (Tunjangan Hari Raya/THR) in 2020 can be postponed if the company’s financial condition gets impacted by the Covid-19 pandemic as long as the employees agree.

However, the last disbursement of THR cannot be later than 7 days prior to the religious day date. Otherwise, the company will be fined 5% of the THR on top of the THR itself to the employees, as regulated in Peraturan Menteri Ketenagakerjaan RI Nomor 6 Tahun 2016.

Shall a company not pay THR at all, then the company will receive the administrative penalty such as:

• Written warning by the Government
• Limitation to the business 
• Freezing to the operations, partially or fully

If you find running payroll and calculating the THR tedious, you should use HReasily now. The payroll system and HRIS will help you automate the manual processes and save you time for more strategic tasks.

*the article is written by Puja Altiar for Startups HR Community organised by HReasily