DPKK Refund Procedure

DKPTKA-DPKK-refund-before-expiry-work-permit-foreigner-indonesia
PROCEDURE FOR REFUND FOREIGNER MANPOWER COMPENSATION FUND (DKPTKA / DPKK)

Ministry of Manpower Regulation No. 20 of 2019 (“Regulation 20/2019”), regulates the requirements of companies to pay a monthly fee of USD 100 into the manpower compensation fund for its foreign workers. The Foreign Manpower Compensation Fund is also known as DKPTKA or or DPKK. Without the payment of the DPKK, companies are unable to obtain a work permit for their foreign workers.

This requirement is not new, as employers have been paying this compensation for many years now for the foreign workers they employ. Important is however that the Regulation 20/2019 confirms that DPKK / DKPTKA can be partial returned in case a foreign worker cancels its work permit before the expiration date.

Since the implementation of the new work permit application system in November 2018 it was not possible for companies to request a refund of DPKK / DKPTKA. This new regulations provides further clarity and companies can use this regulation as basis to request refund.

REFUND PROCEDURE DKPTKA / DPKK

When employers hire foreigners, they must pay in advance the DPKK / DKPTKA for the full length of the assignment. For example, when an employer hires a foreign worker for 12 months, the amount of USD 1,200 must be deposited in advance. In case a foreigner cancels its work permit before the expiration date, the deposit can be refunded for the months not worked by the foreigner.

A company must make a request for refund within one year of the issuance of the relevant notification (work permit). A notification acts as an official approval by the Ministry of Manpower for the recruitment of foreign worker.

The procedure for the DPKTKA refund is as follows:

  • The employer of the foreigner must submit an online application for refund of the DPKTKA
  • Upon acceptance of the refund request, the director of the Utilization and Supervision of Foreign Workers issues a refund recommendation
  • The refund recommendation will be send to the state treasury office. This office will then issue an approval warrant to refund the remaining DPKTKA to the account of the employer.

The Regulation 20/2019 does not stipulate the timeframe for the refund of the DPKTKA. Previously, it could take up to 12 months before the refund was processed by the manpower authority.

REVOCATION OF OLD REGULATION

The enactment of Regulation 20/2019 repeals and invalidates the following regulations from the Minister of Manpower:

  • Number PER.282/MEN/1998
  • KEP.365/M/SJ/1999
  • Number KEP.148/MEN/2001