Safeguarding Severance Pay for Laid-Off Employees During the COVID-19 Pandemic Crisis

Abstract

The COVID-19 pandemic that has hit since early 2020 has The COVID-19 pandemic that has hit since early 2020 has triggered an economic crisis that has forced many companies to carry out mass layoffs (PHK) for reasons of efficiency or losses. This study aims to dissect the legal protection of severance rights for employees laid off during the COVID-19 pandemic within a five-year period (2020-2025), with an analytical focus on Decision Number 120/Pdt.Sus-PHI/2021/PN Mdn. Using normative legal research methods with a statutory approach, a case approach, and a conceptual approach, this study finds that claims of force majeure due to the pandemic do not automatically eliminate the company's obligation to pay workers' normative rights. The results show that Decision Number 120/Pdt.Sus-PHI/2021/PN Mdn serves as an important precedent that confirms that the court functions as the last bastion in guaranteeing the fulfillment of severance pay, long-service pay, and rights compensation, even when the employer faces financial difficulties. The legal implications of this ruling are strengthening workers' bargaining power and affirming that corporate efficiency should not eliminate basic worker rights protections.