What is Pension Security/ Jaminan Pensiun (JP)?
Pension Security (JP) is a protection program to maintain a decent life. Pension Security is given when participants reach retirement age or have a permanent total disability.
It provides a monthly cash benefit to participants upon reaching retirement age, or to their beneficiaries in case of death or disability.
Who is Eligible?
All employees who are working under an employment agreement (permanent or temporary) are required to participate in the pension program
Exclusion: foreigner or expatriate.
Contribution Rate
Employers: 2% of the employee’s monthly wages.
Employees: 1% of the employee’s monthly wages.
Maximum Wages Limit for JP contribution
Up to March 2024: Rp 10.042.300
New Wages Cap Limit effective March 2025: Rp 10.574.400
Formula to calculate JP contribution
[Basic Salary + Backpay Salary + Fixed Allowance]*(contribution rate%)
Example of Calculation:
If an employee’s salary is IDR 9,000,000 per month, a fixed allowance of IDR 2,500,000
Total Wages are IDR 11,500,000
Note: max. cap IDR 10,547,400 in March 2025
Calculations:
Employer: IDR 11,500,000 x 2% = IDR 230,000 [X]
Employer: IDR 10,547,400 x 2% = IDR 210,948 [✓]
Employee: IDR 11,500,000 x 1% = IDR 115,000 [X]
Employee: IDR 10,547,400 x 1% = IDR 105,474 [✓]
