The curfew and its impact on employers; possibilities of drawing contributions for employees’ wages within the “First Aid +” extended programme

02. 11. 2020

Authors: Ondřej Majer, Štěpán Štarha, Lenka Ostró

By its Resolution no. 678 of 22 October 2020, the Government of the Slovak Republic ordered a curfew for the period from 24 October 2020 to 1 November 2020 between 05.00 a.m. and 01.00 a.m. of the next day, restricting access to shopping malls and stores with the exception of grocery stores, drugstores and pharmacies, while the stores were allowed to remain opened. Subsequently, by Resolution of the Government of the Slovak Republic no. 693 of 28 October 2020, the curfew was prolonged and extended from 2 November 2020 to 8 November 2020 between 05.00 a.m. and 01.00 a.m. The extended curfew does not apply citizens with a negative result of the RT-PCR test and/or the antigen test certified in the territory of the European Union for the COVID-19 disease and performed no later than 24 hours before 24 October 2020.

Below is a short summary of the obligations that apply to employees based on the curfew and how employers can protect their employees.

If the result of an employee’s RT-PCR and/or antigen test is positive, the employee must stay at home in a 10-day quarantine, and must contact their general practitioner who will issue to the employee a certificate of temporary incapacity for work due to the ordered quarantine or isolation. During such “pandemic” incapacity for work the employee receives sickness allowances from the Social Security from the first day – known as pandemic incapacity for work.

Employees who do not undergo the test are not permitted to report to work during the time period concerned and are obliged to stay at home in quarantine for at least 10 days. Pursuant to the Labour Code, this constitutes personal obstacle to work on the part of the employee.

The employee is obliged to inform the employer of such obstacle in advance and agree on working from home if the nature of the employee’s work so permits, or on taking vacation. If neither of the two options is possible, we believe that this constitutes an obstacle on the part of the employee. For the duration of such obstacle the employer is obliged to excuse the employee’s absence from work but is not obliged to pay any compensation for wages to the employee. Thus, the employee is on unpaid leave.

Following the general testing, employers have the right to ask employees to produce proof that they have a negative test for COVID-19, whether from the general testing or from any other authorised testing, or to produce a certified proof of exemption that they did not have to undergo the test. If an employee is unable to produce the result of such test or proof of exemption from the testing obligation, the employer must restrict such employee’s access to the workplace.

Employers are entitled to demand this information from employees under Decree no. 16/2020 of the Public Health Authority of the Slovak Republic of 30 October 2020.

First Aid +

The curfew in effect since 24 October 2020 and the increasing numbers of infected persons have paralysed many operations in various industries. Therefore, the Government has introduced a new state aid programme for the affected entrepreneurs, known as “Prvá pomoc +” (“First Aid +”). Below is a short outline of changes in the new state aid programme.

Entrepreneurs may apply for state aid under the “First Aid +” project based on its revised terms and conditions for October 2020 for the first time. As usual, all details (in Slovak) regarding the aid are available at www.pomahameludom.sk.

Apart from the changes to the terms and conditions, the Government has also extended the period of time during which employers can apply for the contribution to January through March 2021.

The employment authority will distribute amendments to previously executed agreements to existing applicants from 2 November 2020. New applicants who have not signed an agreement with the employment authority may apply for the aid in the week of 9 November 2020, until 31 January 2021.

In the first group, applications for the contribution can be again submitted by employers who had to shut down or restrict their operations on the basis of the Measure of the Public Health Authority, whereas the measure introduces the following changes:

  • The new contribution for payment of a portion of payroll costs per employee has been increased from 80% of gross salary to 80% of the total cost of labour – this means that the state will also reimburse the employer for a portion of the payments made by the employer for the employee;
  • It is now possible to apply for the contribution also in respect of employees whose employment commenced on 2 September 2020 at the latest;
  • This group of applicants now also includes those who launched operations on 2 September 2020 at the latest.

In the third group, i.e. employers who are afflicted by the current emergency but who have not shut down their operations due to the Measure aforesaid, the rules have also been modified:

  • It is now possible to apply for the contribution also in respect of employees whose employment commenced on 2 September 2020 at the latest;
  • This group of applicants now also includes those who launched operations on 2 September 2020 at the latest;
  • Under measure 3A), where the employer is unable to assign work to the employee but the operations have not been mandatorily shut down, the amount of the contribution has been increased to 80% of the total cost of that employee’s labour, capped at EUR 1,100;
  • Under measure 3B) the employer may apply for a lump sum contribution for payment of a portion of the payroll costs for each employee, depending on the decline in the employer’s revenues; here, the contribution has been increased by 50%.

Apart from the above-described aid to legal entities – employers, the Government has also increased the financial contribution intended for independent contractors. In addition, the state will provide an SOS subsidy of EUR 300 to citizens who lost their jobs during the crisis.

Special aid in a total amount of EUR 100 million will be provided to entrepreneurs doing business in tourism. Applications may be submitted by restaurants, cafes, bistros, hotels and pensions, aquaparks and swimming pools, tour guides, botanical gardens, zoos, nature reserves, theme parks and amusement parks, museums, historical monuments and tourist attractions, and ski tow, ski lifts and cable car operations (the list of eligible beneficiaries will be specified by the Slovak Ministry of Transport and Construction).

Application for this aid is conditional on a decline in the revenues of entrepreneurs in this sector in the period from 1 April 2020 to 31 December 2021 by more than 40% as a result of the pandemic compared to 2019, and the contribution will range from 1.4% to 10% depending on the decline in revenues.

Conclusion

Although the persisting crisis in the market is unbearable for many entrepreneurs, the increased state aid as well as the modified active measures adopted in the labour market may have some positive effects, even though those effects will manifest themselves later. However, the results may to a certain extent be distorted by measures towards gradual alleviation of the restrictions, or by a strict lockdown. Of course, we will continue monitoring the developments and will keep you updated on any new adopted measures.

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