Yesterday, the Government adopted Decree on the conditions and the application procedure for employer`s compensations aiming to preserve the employment during the state of emergency, declared with Parliament decision dated 13th of March 2020 (the Act)
The measure provides for the National Social Security Institute to pay compensation to the employers aimed at maintaining employment throughout the declared state of emergency and after that or for the reinstatement. The compensation will amount to 60% of the earnings insured for January 2020 of each employee, for whom the employer has decided to seize this opportunity and whose employment will be preserved for а period not less than the period for which the compensation has been paid. The difference of 40% up to the full amount of the gross remuneration shall be borne by the employer. The compensation will be paid if the activity of the entire enterprise or only a part of the enterprise is ceased for the whole period of the declared state of emergency or for a part of this period, but for no more than 3 months.
Who is entitled?
According to the Act, one can apply for this compensation if s/he has ceased the activity of the entire enterprise, a part of the enterprise or the activity of some employees due to the state of emergency declared with an act of a public authority (here falls all the activities, which are directly affected by the imposed bans).
Example: retail trade, transport, catering and hospitality, tourism, artists, athletes, etc.
Тhere is a list of the sectors, which are not obliged to prove a decrease in their sales revenue. You can find the whole list HERE
One can apply for this compensation even if the business in question is not directly affected by the imposed bans, but in this case, it is required that the activities are ceased the activity by the employers’ order or part-time working hours are introduced due to the declared state of emergency. In this case one must prove a decrease in the sales revenue by at least 20% during the month prior the one, in which the application shall be submitted, compared to the same month in 2019.
If your company has been established after 1st or March 2019, the decrease in your sales revenue by at least 20% should be realized during ‘the month prior the month, in which the application was submitted, compared to the averaged revenue for January and February 2020.’
If one has introduced part-time working hours – for the entire enterprise or only for a part of the enterprise, s/he can also apply, but in this case, the compensation will be proportional to the idle time, but for not more than 4 hours per day.
How the compensations will be paid?
The application procedure, as well as the documents that should be enclosed to the application form, are stated in the Act. The application shall be submitted to the Labour Office оf the district where the employee`s workplace is located.
Persons carrying out the following 7 activities are excluded from the possibility of applying for this compensation:
- Activity “A” under the Classification of the economic activities (CEA) – Agriculture, Forestry, Fisheries
- Activity “K” under CEA – Financial and insurance activities
- Activity “O” under CEA – Government
- Activity “P” under CEA – Education
- Activity “Q” under CEA – Human health and social work
- Activity “T” under CEA – Activities of households as employers; undifferentiated activities of households for the production of goods and services for own consumption
- Activity “U” under CEA – Activities of extraterritorial organizations and services.