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Termination of employment can originate from the desires of employer and/or the employee. When the termination is at the behest of the employer, it is called PHK.

If termination of employment cannot be avoided, the things that must be done by employers are as follows:

1. Ìý

   •ÌýÌýÌýÌý calculate last wages

2. Ìý

   •ÌýÌýÌýÌý issue Form 1721-A1

3. Ìý

   •ÌýÌýÌýÌý update social security data

(Government Regulation number 94 Year 2010, Art 15, para (1), and Directorate General of Taxes Regulation number PER-16/PJ/2016, Art 21)

Last wages

The employer must prepare the calculation of the employee's last remuneration. Last remuneration consists of:

1. Ìý

   •ÌýÌýÌýÌý salary

2. Ìý

   •ÌýÌýÌýÌý allowance

3. Ìý

   •ÌýÌýÌýÌý entitlement reimbursement (uang penggantian hak), and

4. Ìý

   •ÌýÌýÌýÌý severance pay (uang pisah/pesangon)

There is different formula for calculating severance pay when termination is at the behest of the employer (PHK). The severance pay arising on PHK is greater than severance pay due when an employee resigns. See below. Also, see 3.6 for severance pay requirements in the