What Employers Need to Know About Job Loss Guarantee (JKP) in Indonesia

Indonesia has introduced the Job Loss Guarantee (JKP), also known as Jaminan Kehilangan Pekerjaan, to support workers who lose their jobs. This government program provides financial aid, job training, and assistance in finding new employment. It’s part of the country’s efforts to improve job security. 

Understanding how JKP works is essential for employers and foreign investors. Knowing your responsibilities under this program helps you comply with Indonesian labor laws. It’s also useful when using services like Employer of Record or HR outsourcing to manage staff in Indonesia. 

Understanding Job Loss Guarantee (JKP) in Indonesia 

The Job Loss Guarantee (JKP) is a government-backed insurance program to support employees who lose their jobs. It provides three key benefits: cash assistance, access to labor market information, and job training services. 

The primary aim of the JKP program is to support workers in maintaining a reasonable standard of living following job termination. It enables unemployed individuals to cover essential needs while seeking new employment. Through temporary financial aid and access to skill development, JKP facilitates a smoother transition back into the workforce. 

Legal Basis and Implementation of Job Loss Guarantee (JKP) 

The Indonesian government has updated its Job Loss Guarantee (JKP) program, as outlined in Government Regulation (PP) No. 6 of 2025, effective February 7, 2025. This reform replaces the previous tiered benefit system with a simplified approach, providing 60 percent of a laid-off employee’s last salary for up to six months. The goal is to ease employer compliance and enhance predictability for beneficiaries. 

The updated regulation is designed to support workers better while ensuring business sustainability during economic downturns. It introduces the following key elements: 

• Standardized Benefit Structure: A flat-rate benefit of 60% of salary for six months improves clarity and efficiency. 
• Simplified Administration: Streamlining procedures helps employers meet compliance more easily. 
• Employer Responsibilities: Businesses must adjust to updated contribution rules and ensure timely employee registrations. 
• Support for Workforce Resilience: The reform aims to maintain basic living standards for unemployed workers and support their efforts to reemploy. 

These legal updates demonstrate Indonesia’s commitment to enhancing its labor protection framework while acknowledging the operational challenges faced by businesses. 

READ MORE:

• Learn More About BPJS in Indonesia
• Complete Guide to Indonesia’s Labor Law: Contracts, Leave, Wages & Termination 
• Legal Framework for Employee Dismissal in Indonesia 

Key Benefits Provided by Job Loss Guarantee (JKP) 

The Job Loss Guarantee (JKP) program offers comprehensive support to workers who have lost their jobs. It aims to maintain their standard of living and facilitate their return to the workforce. The benefits are designed to deliver financial support, connect individuals with labor market insights, and offer opportunities for job training. 

Cash Benefits 

Eligible workers receive monthly cash payments of 60% of their last reported salary for six months. This standardized benefit replaces the previous tiered system, simplifying the process for both employers and employees. The maximum wage for this benefit is capped at IDR 5,000,000, resulting in a maximum monthly payout of IDR 3,000,000. 

Access to Labor Market Information 

JKP participants gain access to a wealth of labor market information through platforms like SIAPkerja, which connects job seekers with potential employers. This service includes: 

• Job Vacancies: Up-to-date listings tailored to the participant’s skills and experience. 
• Career Counseling: Support with career planning and effective job search techniques. 
• Market Trends: Insights into current labor market conditions and demands. 

These resources are designed to expedite the job search and align participants with suitable employment opportunities. 

Job Training Programs 

JKP offers reskilling and upskilling programs through accredited training institutions to enhance employability. These programs focus on: 

• Skill Development: Acquiring new skills relevant to the current job market needs. 
• Certification: Earning recognized credentials to validate new competencies. 
• Flexible Learning: Options for online, offline, or blended learning environments. 

Participation in these training programs is based on recommendations from career counselors and is tailored to the individual’s career goals and market demands. 

What Employers and Foreign Investors Must Know and Do 

With the revision of Indonesia’s Job Loss Guarantee (JKP) under Government Regulation No. 6 of 2025, employers and foreign investors face new responsibilities and opportunities. These changes strike a balance between worker protection and business continuity, particularly during periods of economic uncertainty. Staying compliant is a legal requirement and a strategic move to maintain workforce trust and operational stability. Here’s what you need to know and do: 

Employer Obligations Under the Revised JKP Program 

• Reduced Contribution Rate: Employers must now contribute 0.36% of an employee’s monthly wage to the JKP fund, reduced from the previous 0.46%, easing the financial impact on businesses. 
• Timely Registration and Contributions: All eligible employees must be registered with BPJS Ketenagakerjaan and make contributions punctually to ensure their benefit eligibility. 
• Liability in Insolvency Cases: Companies are responsible for unpaid JKP dues even in bankruptcy. However, BPJS Ketenagakerjaan ensures continuity of benefits for affected workers. 
• Compliance Documentation: Employers must keep accurate employment records to support JKP claims for terminated employees. 

Considerations for Foreign Investors 

• Alignment with Labor Policies: Businesses must adapt their HR practices to stay aligned with updated regulations, especially during periods of workforce downsizing. 
• Use of Employer of Record (EOR) Services: EOR providers can manage compliance, employee benefits, and payroll, simplifying local HR complexities for foreign entities. 
• HR Outsourcing Benefits: Partnering with HR outsourcing firms ensures efficient benefits management and helps maintain compliance with JKP rules. 
• Risk Management Strategy: Understanding and planning for JKP obligations helps reduce legal risks and enhance a company’s reputation in the Indonesian market. 

Ensure Compliance and Make Wise Hiring Choices with InCorp 

Understanding Indonesia’s Job Loss Guarantee (JKP) is crucial for employers as part of their human resources (HR) and compliance responsibilities. With recent regulatory updates, staying compliant helps mitigate risks, supports employee well-being, and ensures business continuity. 

Navigating Indonesia’s employment regulations is easier with the right partner. InCorp Indonesia (an Ascentium Company) offers specialized support through: 

• Employer of Record (EOR: Ideal for businesses looking to hire employees in Indonesia without setting up a local entity. 
• Human Resources Outsourcing (HRO): Perfect for companies seeking end-to-end HR solutions. 

Please complete the form below to ensure your HR practices comply with and strategically align with Indonesia’s evolving labor landscape.