As the holiday season approaches, one thing most employees look forward to is the Holiday Allowance, commonly known as THR. THR also helps cover additional expenses and serves as a form of appreciation from the company for employees’ hard work. However, many people still do not fully understand how to calculate THR according to the rules.
To avoid confusion, let us go through it step by step.
What Is THR and Who Is Entitled to Receive It
THR is an allowance that companies must provide employees ahead of a religious holiday. This right applies to both permanent and contract employees, as long as they meet the required length-of-service requirement.
This means that not only are long-term employees entitled to THR. New employees are also eligible, although the amount is adjusted based on how long they have worked.
Government Regulations on Employee THR
The government has stipulated that THR must be paid no later than seven days before the holiday. THR must also be paid in full and cannot be paid in installments.
Companies that fail to pay THR or pay it in violation of regulations may be subject to sanctions. Therefore, THR is not merely an internal company policy, but a legal obligation protected by regulation.
How to Calculate THR for Employees with One Year of Service or More
For employees who have worked continuously for at least 12 months, the calculation of THR is quite straightforward.
The amount of THR is equal to one month’s salary. Salary here does not only mean basic salary; it also includes fixed monthly allowances.
For example, if an employee has a basic salary of Rp 5,000,000 and a fixed allowance of Rp 1,000,000, then the THR received is Rp 6,000,000.
How to Calculate THR for Employees with Less Than One Year of Service
If an employee has not yet completed one year of service, THR is still given, but it is calculated proportionally. The formula is to divide the length of service in months by 12, then multiply it by one month’s salary.
For example, an employee with a salary of Rp 4,000,000 and a length of service of 6 months. The calculation is 6 divided by 12, multiplied by Rp 4,000,000. The result is a THR of Rp 2,000,000.
This system ensures that every employee still receives their rights fairly, even if they have not worked for a long time.
Salary Components Included in THR Calculation
In calculating THR, the basis is the basic salary and fixed allowances. Fixed allowances are paid regularly and are not dependent on attendance or specific performance targets.
Meanwhile, non-fixed allowances such as overtime pay, bonuses, or incentives are generally not included in the THR calculation.
Important Points to Note Regarding THR Payment
Several points often raise questions. First, THR cannot be paid in installments. Second, THR must still be paid even if the company is facing certain challenges, unless there are specific provisions in accordance with applicable regulations.
For this reason, transparency between the company and employees is very important to avoid misunderstandings.
Tips for Managing THR So It Does Not Run Out Quickly
After receiving THR, the next challenge is managing it wisely. Try to prioritize essential needs such as holiday expenses, family obligations, or outstanding installments.
Set aside a portion of your THR for savings or an emergency fund. This way, THR is not only spent on shopping, but also provides long-term benefits.
Closing
Understanding how to calculate THR in accordance with regulations is important not only for HR and companies but also for employees. By knowing their rights and the calculation mechanism, employees can feel more secure, and companies can avoid mistakes.
THR is certainly something to be happy about, but what matters most is how we use it wisely and responsibly.
