As a step in assuring the giving of decent income to workers/laborers in Indonesia, especially those engaged in the hotel business and restaurant business at hotels, the Manpower Minister of the Republic of Indonesia has issued the Regulation of the Manpower Minister No. 7 of 2016 concerning Service Charges of Hotel Business and Restaurant Business at Hotels (“Permenaker No. 7/2016“). Permenaker No. 7/2016 is the implementing regulations of Article 10 paragraph (3) of Government Regulation No. 78 of 2015 concerning Wage (“PP No. 78/2015“)
Right of Service Charge
Service charges are non-wage income which are provided in order to reasonably meet what the workers/laborers and their families need for living. Entrepreneur that runs hotel business and restaurant business at a hotel can enforce service charges. Service charges are given to workers/laborers that have work relations with an entrepreneur based on an indefinite time contract or definite time contract. Workers/laborers of a company that receive part of jobs and work for an entrepreneur running hotel business and restaurant business at a hotel, are also entitled to service chargers.
Workers/laborers that are laid off before service charges are distributed, are entitled to service charges the amount of which is calculated proportionally. If the aforementioned workers/laborers are re-employed, they are entitled to service charges since they are re-employed, which are given proportionally in the first month.
Collection and Management of Service Charges
Entrepreneur shall collect and manage service charges before being distributed. The management of service charges shall be done separately from the company’s operation. Entrepreneur shall announce the collection and management of service charges which is made in writing, to workers/laborers every month before the service charges are distributed.
The use of service charges is set as follows (a) 3% (three percent) to replace risks of loss or damage, (b) 2% (two percent) to improve the quality of human resources in a more efficient way, and (c) 95% (ninety-five percent) to be distributed among workers/laborers.
If the percentage of service charges used to replace any risk of loss or damage and/or the percentage of service charges used to improve the quality of human resources in a more efficient way are not entirely used, the entrepreneur and workers/laborers can decide the use of the remaining service charges based on an agreement, which shall be adjusted to the use as mentioned above.
Distribution of Service Charges
Service charges shall be distributed among workers/laborers after being reduced by replacement of risk of loss or damage and the improvement of the quality of human resources in an efficient way. Service charges collected for 1 (one) calendar month after being reduced by replacement of risk of loss or damage and the improvement of the quality of human resources in an efficient way, shall be distributed among workers/laborers entitled to them no later than the following 1 (one) calendar month.
The method of distributing service charges shall be set by the entrepreneur by taking into account the principle of evenly distribution and prime services, in which 50% (fifty percent) is distributed in equal amount and the rest is distributed based on seniority and performance. The service charges can only be calculated after service charges have been collected.
Income tax on service charges received individually by workers/laborers is borne by the relevant workers/laborers. Income tax on service charges is withheld by an entrepreneur at the time when service chargers are distributed among workers/laborers. Entrepreneur gives evidence of tax payment to the State Treasury to workers/laborers according to the law and regulation.
Rahmaddiar Ibrahim, SH.