Tangerang firms owe Jamsostek Rp 5 billion

TANGERANG (JP): Firms have postponed or failed to pay Rp 5 billion (US$606,606) in workers' insurance per month since January to the Tangerang branch of the state-owned social security company PT Jamsostek, an official said yesterday.

The mass layoff of workers has also had an impact on the amount of monthly fees Jamsostek collects from firms as nearly 10,000 people are no longer on the payroll.

But the main source of the shortfall is private companies which have postponed their payments due to the current monetary crisis, the Jamsostek's office manager Salim RA. Toha said.

"Many companies have asked for a rescheduling of their workers' insurance payments of between two weeks and four months because of the financial difficulties they are encountering."

Salim said 10 manufacturing companies, which employ at least 5,000 employees each, must pay about Rp 300 million per month each.

The companies were allowed to postpone their payments, but they will be charged interest at a rate of 2 percent a month, he said.

Salim explained that the decline in premium payments was also caused by massive layoffs by construction companies and development companies in the area.

"The worker dismissals do affect the payment of the insurance premium."

Data from Jamsostek's Tangerang branch shows that the company used to receive premium payments amounting to tens of billions of rupiah each month for at least 520,000 workers employed at 1,486 companies.

Chairman of the Tangerang branch of the Indonesian Employers Association (Apindo) M. Nasir DS. urged employers to avoid further worker layoffs.

"We hope the employers can come up with other alternatives, such as reducing production hours... instead of laying off their workers," Nasir said.

The Tangerang manpower office said nearly 10,000 workers had been laid off during the crisis and the number was expected to continue increasing as the office was still processing proposals by other companies for further worker dismissals. (41/jun)