Construction Services Employee Social Welfare Guarantee Program - Implementing Guidelines

The program covers work accidents and death. All employees and labourers are required to be registered in the program. The registration of participants in the program must be effected at least two days prior to the construction services starting. The necessary forms for completing the registration process are attached to the Regulation.

The amount of the compulsory contributions depends on the value of the construction services contract. For example, a contract of up to IDR 100 million requires a compulsory contribution of 0.24%. For contracts in excess of IDR 5 billion, the compulsory contribution is 0.10%. In addition there are specific contributions to be made based on the wage components of the contract at the rate of 1.74% for work accidents and 0.30% for death.

The Regulation sets out the benefits payable and how they are to be claimed by either the victim in a work accident or the victim’s family if the accident causes the death of the employee. Where an employee is incapacitated for a period of time then the employee is entitled to receive 100% of their wage for the first four months, 75% for the next four months, and 50% for every month after that. Where there is part or full incapacitation payments based on the prevailing schedule are to be made for a period of eighty months.

Generally, employers have 48 hours to report work accidents to the relevant authorities at the Department of Labor and Transmigration. The reporting procedures require the furnishing of statement letters from the attending doctor, photocopy of workplace attendance, evidence of all expenses incurred in the medical treatment of the employee (victim), a police report, and a death certificate (if the employee dies).

The sanctions are restricted to those that are applicable under Law No. 3 of 1992 on the Employee Social Welfare Guarantee for breaches of Article 2(3) and Article 7(1)(b) of this Regulation.

The Regulation was issued on 3 September 2008 and has been in force since 9 September 2008.