Pemutusan Hubungan Kerja (PHK)
Termination of employment, entitling workers to severance and other rights.
Definition
Pemutusan Hubungan Kerja (PHK), or Termination of Employment, refers to the cessation of the employment relationship between an employer and a worker due to various reasons as stipulated by law. The Job Creation Omnibus Law modifies certain aspects of PHK, including the reasons for termination and the calculation of severance pay. While the law aims to simplify business processes, it also maintains provisions for workers to receive severance pay, service appreciation pay, and compensation for rights upon PHK. Notably, the law introduces a Job Loss Insurance (Jaminan Kehilangan Pekerjaan - JKP) program to provide a safety net for workers who experience PHK, offering cash benefits, access to job market information, and job training.