Dismissing Employees in Times of COVID-19

COVID-19 has had a devastating effect on many businesses around the world and Indonesia, although the number of confirmed COVID-19 cases are very low in comparison to its vast population, is affected the same way as other countries. Many companies have experienced a sharp drop in revenue while their fixed costs have largely remained at the same level.

For many companies, a large portion of these fixed costs are employee salaries. It is thus not surprising that there had already been many layoffs at the beginning of the global pandemic:

COVID-19 has forced governments around the world to take various different actions. Almost all governments imposed travel restrictions one way or another. In Indonesia, international travel has been almost halted and foreigners are finding it very difficult to enter Indonesia.
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The Directorate General of Immigration recently issued Circular Letter No.IMI-GR.01.01-1102 of 2020 on Immigration Stay Permit Service during the New Normal Period (“Circular Letter”). It came into effect on 13 July 2020 and …

The global COVID-19 pandemic has gravely affect the world”s economy, including that of Indonesia. Despite the biggest decline in economic growth since the Great Depression during the 1930s, the recent disruptions have their “winners” from a business point of view. The medical industry is one of them and Indonesia, which heavily relies on the import of medical devices, is a potentially highly lucrative market.
Medical devices are instruments (e.g. surgical mask), machines or implants…

Indonesia, like virtually all other countries around the world, has issued various decrees over the last few months to stop the spread of the Coronavirus. These decrees among others provide for social distancing and require that employees work from home. 1

However, exemptions apply and some companies are allowed to keep open despite the measures taken. These companies must take various measures and the Ministry of Health recently issued a decree on Workplace Guidelines (the “Guidelines”), 2 setting out clear details of what obligations…

Indonesia, like virtually all other countries around the world, has issued various decrees over the last few months to stop the spread of the Coronavirus. These decrees among others provide for social distancing and require that employees work from home. [1]

However, exemptions apply and some companies are allowed to keep open despite the measures taken. These companies must take various measures and the Ministry of Health recently issued a decree on Workplace Guidelines (the “Guidelines”), [2] setting out clear details…

Indonesia is one of many countries which has become a destination for foreign investors to make an investment with the purpose of maximizing their profits. Having a large land mass, rich soil and benefitting from a tropical climate, Indonesia is opulent in natural resources such as oil and minerals, timber and raw/semi-processed agricultural products. For those wishing to invest in Indonesia, the usual choice is the foreign-invested Ltd. (in Indonesian: Perseroan Terbatas Penanaman Modal Asing). [1] However, prior to establishing a foreign-invested Ltd., investors are allowed to…

Indonesia, like virtually all other countries around the world, has issued various decrees over the last few months to stop the spread of the Coronavirus. These decrees among others provide for social distancing and require that employees work from home. [1]

However, exemptions apply and some companies are allowed to keep open despite the measures taken. These companies must take various measures and the Ministry of Health recently issued a decree on Workplace Guidelines (the “Guidelines”), [2] setting out clear details of what obligations there are both…

Legal disputes cost companies billions of dollars every year. In addition to court fees and the costs of legal representation, the two biggest cost contributors are the disruption the dispute causes within your company and the (legal) uncertainty arising from the dispute. Therefore, reaching an amicable settlement is often the best way to deal with the dispute.

In spite of the negative side of disputes, you should not make the mistake of settling any dispute you are in. This holds especially true when you are a foreign investor to Indonesia…

Schinder Group considers being charitable and giving back to the community key values to live by. The Coronavirus pandemic gravely affected Indonesia. In addition to many lost lives, there are millions of lost jobs. All the while, the costs of living and for food, in particular, have surged. Schinder Group’s employees understand that rolling up their sleeves and working harder to support those most in need is now required more than ever. In addition to the numerous volunteer causes our employees are involved in on an individual basis, we also engage in firm-wide initiatives. This includes our annual Eid al-Fitr food box donations…

Each country has its own customs when it comes to paying bonuses which are not performance-based to employees on certain occasions. In many parts of the world, employees receive a bonus payment for Christmas, in other parts this is prior to the summer holiday period or for the New Year. In Indonesia, employers are under an obligation pay a so-called “Religious Holiday Allowance” (Tunjangan Hari Raya). [1]

Tunjangan Hari Raya is a non-wage income to be paid once a year and at least seven days prior to the religious holiday in question…