Indonesia - How DKI Jakarta Is Supervising Companies During Covid-19 Restrictions.
Legal News & Analysis - Asia Pacific - Indonesia - Regulatory & Compliance
6 May 2020
In response to COVID-19, the government officially enacted large-scale social restrictions, or Pembatasan Sosial Berskala Besar (“PSBB”), in Jakarta beginning April 10, 2020, to help check the spread of the virus.
The enactment of the restrictions was based on Minister of Health Regulation No. 9 of 2020 concerning Guidelines for Large Scale Social Restrictions to Expedite Countermeasures Against COVID-19. Jakarta residents have been instructed to stay at home, while schools and workplace are closed, religious, social and cultural activities are restricted, and limitations have been placed on transportation and public facilities.
Companies Exempted from Social Restrictions
Exemptions to workplace closure are made for companies that provide services involving the public interest including healthcare, food and beverage, energy, communications, banking and finance, logistics, and strategic business sectors that are crucial to fulfilling people’s daily needs.
Examples of businesses exempted from PSBB are businesses selling basic ingredients and medicines such as supermarkets and pharmacies, restaurants, healthcare centers, transportation services, and facilities that help fulfill the community’s basic needs.
However, even if a business is allowed to remain open it must follow established COVID-19 workplace protocols set by the government, which include restricting interactions, denying workplace access to people with underlying health conditions that could make them more vulnerable to COVID-19, ensuring the cleanliness and hygiene of the workplace, providing necessary healthcare protections, ensuring physical distancing between people of at least one meter, and specifically for restaurants, providing only takeaway or online order/delivery services.
Industrial companies can also receive a PSBB exemption. The Ministry of Industry allows industrial companies and/or companies located in industrial parks to operate their factories and offices, and maintain the movement of their workers, materials and finished products, as long as they have the necessary operational license, known in Indonesian as an Izin Operasional dan Mobilitas Kegiatan Industri (“IOMKI”).
Note that companies require an account at the National Industry Information System (Sistem Informasi Industri Nasional or “SIINas”) to apply for the IOMKI through the SIINas website.
As of last week, 900 companies have obtained an IOMKI. Note that companies with an IOMKI are still obliged to comply with COVID-19 workplace protocols and establish standard operating procedures in the workplace. They must also provide weekly reports on their operations and mobility to the Ministry of Industry by uploading the reports to the SIINas website. Failure to submit a report for three consecutive weeks will result in revocation of the IOMKI.
Companies not included in the list of sectors allowed to operate or that have not obtained an IOMKI are obliged to adhere to PSBB by closing their offices and having employees work from home. According to the DKI Jakarta provincial government, which is monitoring compliance with social distancing restrictions, 3,725 companies have reported the implementation of PSBB, with 1,306 of those companies having implemented full work from home and the rest conducting partial work from home and significantly reducing activity in the workplace. The DKI provincial government is routinely supervising and monitoring companies and workplaces in Jakarta to ensure they are implementing PSBB. Companies that violate PSBB will face sanctions.
Sanctions for Violation of PSBB
The prevailing laws and regulations, namely Governor of DKI Jakarta Province Regulation No. 33 of 2020 regarding the Implementation of PSBB to Handle COVID-19 in DKI Jakarta Province and Law No. 6 of 2018 regarding Health Quarantine, provide that individuals who violate the implementation of a health quarantine, including PSBB, causing a health emergency, may be imprisoned and/or fined up to IDR 100 million. On this basis, the DKI Jakarta provincial government has implemented sanctions for businesses/workplaces that violate PSBB. If the business/workplace is a limited liability company, the members of the company’s Board of Directors will be responsible for any violation of PSBB.
The DKI provincial government is routinely supervising and monitoring companies and workplaces in Jakarta. Officials have divided companies in the Indonesian capital into three categories, namely
(i) companies that are allowed to operate because they fall under a business sector exempted from PSBB;
(ii) companies that are not allowed to continue operating; and
(iii) companies that have obtained the necessary licenses to continue operating.
For companies in the first and last category, the government is conducting strict supervision to ensure they are adhering to social-distancing protocols in the workplace.
Whereas businesses in the second category are strictly prohibited from operating and the government is routinely monitoring and inspecting these workplaces to ensure they remain closed. Companies found in violation of PSBB will receive warnings, guidance and closure until the end of the PSBB period. As of April 24, 2020, 502 companies had been found in violation of PSBB and 71 companies had been temporarily closed by the government.
The government also has issued warnings to 76 companies that obtained a license from the Ministry of Industry to continue operating but failed to comply with COVID-19 workplace protocols.
The DKI provincial government has also put in place a mechanism for employees to report their companies for not adhering to PSBB. Employees can file a report at bit.ly/laporanpelaksanaanwfh. This reporting mechanism has been put in place to ensure the implementation of PSBB and that workers are being treated in accordance with the provisions of Minister of Manpower Circular Letter M/3/HK.04/III/2020 concerning he Protection of Workers and Laborers and Business Continuity in the Context of Preventing COVID-19.
Practical Steps for Businesses
In light of the above, we strongly urge all companies to adhere to the current PSBB regulations that have been put in place. To determine their next steps, we suggest businesses consider the following:
1. What activities are conducted by the business?
2. What licenses does the business operate under?
3. Are the activities conducted by the business included in the list of sectors permitted to continue operating during PSBB?
4. Is the company involved in industrial activities and has it set up a SIINas account so it can apply for an IOMKI?
5. Has the company obtained an IOMKI?
6. If the company is among those permitted to continue operating, has it established guidelines to adhere to the COVID-19 workplace protocols set by the government?
The provincial government in Jakarta is continuously supervising the implementation of PSBB for both individuals and businesses. Companies found in violation of PSBB regulations may receive a warning or be forced to close until the end of the PSBB period.
We strongly urge companies not among those permitted to continue operating to close their offices and introduce work from home measures. Companies that are permitted to continue operating should ensure they adhere to the COVID-19 workplace protocols. If your company is involved in industrial activities, we recommend you obtain an IOMKI.
More information on how to obtain the IOMKI license can be found in our previous articles, “Indonesia Provides Mechanism for Companies to Operate During Pandemic”
and “Update on License for Companies in Indonesia to Operate During Pandemic.”
For Further Information, please contact:
Dewi Savitri Reni, Partner, Soewito Suhardiman Eddymurthy Kardono