On the 30th of July 2020, Decree Law 46-A/2020 was published, which creates the support for the gradual recovery that had already been broadly addressed by Council of Ministers Resolution 41/2020 under the Economic and Social Stabilisation Programme. This support replaces the Simplified Lay off and is applicable to companies that are in business crisis.
WHO CAN BENEFIT FROM THIS SUPPORT?
The extraordinary support for the gradual recovery is aimed at employers who, as a result of the COVID-19 disease pandemic, are in a situation of business crisis.
A situation of business crisis is defined as the existence of a fall in invoicing of 40% or more in the calendar month immediately preceding the request for support or its extension. This fall in invoicing is measured against the same month of the previous year or the two immediately preceding months.
Companies that have been in business for less than 12 months calculate the invoicing break with reference to the average monthly invoicing between the start of business and the penultimate complete month preceding the calendar month to which the application refers.
WHAT ARE THE SPECIFICATIONS OF THIS SUPPORT?
This figure, unlike the simplified Lay Off, only allows the reduction of normal work periods and no longer the suspension of employment contracts.
It lasts one calendar month, but has the particularity of being able to be applied for interpolated months.
HOW TO ACCESS THIS SUPPORT?
In order to benefit from the mechanism for the temporary reduction of normal working hours, the employer must inform the workers who will be covered by it, in writing, of the percentage reduction as well as the foreseeable duration of the implementation of the measure.
Representative structures, trade union representatives and work councils, if they exist, must be heard, and a time limit for their pronunciation, which may not be less than three working days, may be set.
WHAT IS THE DURATION OF THIS SUPPORT?
Extraordinary support for the gradual resumption of activity with a temporary reduction of the normal working period lasts for one calendar month and can be extended monthly until 31 December 2020.
WHAT ARE THE LIMITS TO THE REDUCTION OF THE NORMAL WORKING PERIOD?
The normal working period of the workers covered by the phase-in support may be as follows:
Reduction of 50%, during the months of August and September;
40% reduction during October, November and December.
If the employer has a 60% or more fall in invoicing, he may reduce the normal working period of the workers covered under the following terms:
Reduction of 70%, during the months of August and September;
Reduction of 60%, during the months of October, November and December.
WHAT IS THE REMUNERATION DUE TO THE WORKERS COVERED?
The workers covered by this mechanism of reduction of the normal working period are entitled to:
a) Remuneration corresponding to the hours actually worked, paid in full by the employer;
b) Remuneration for hours not worked, up to a maximum value of three RMMG (EUR 1,905), calculated as follows:
Months of August and September 2020: two-thirds of the gross normal remuneration corresponding to hours not worked;
Months of October, November and December: four fifths of the gross normal wage corresponding to hours not worked.
If the sum of wages and salary compensation is less than the RMMG (EUR 635), the amount of salary compensation must be increased to ensure this minimum value.
WHAT DOES FINANCIAL SUPPORT CONSIST OF?
Employers who benefit from this mechanism of temporary reduction of the normal working period are entitled to financial support corresponding to 70% of the value of the remuneration compensation, being guaranteed by Social Security, by bank transfer.
WHAT DOES THE ADDITIONAL SUPPORT CONSIST OF?
Companies with a loss of turnover of 75% or more are entitled to an additional support corresponding to 35% of the gross normal remuneration for the hours worked owed to each worker covered.
The sum of this additional support with the financial support cannot exceed the value of three RMMG, i.e. EUR 1,905.
REGARDING HOLIDAYS, HOLIDAY ALLOWANCE AND CHRISTMAS BONUS?
The reduction of the normal working time period does not affect the duration and salary of the holiday period, nor does it affect its scheduling and enjoyment.
Employees who are on holiday are entitled to the payment of wages and salary compensation, as well as holiday allowance, paid by the employer under the terms in which it would be due under normal working conditions.
The Christmas allowance is payable in full, with the Social Security paying the amount corresponding to one-twelfth of half of the salary compensation for the number of months of entitlement to it.
WHAT ARE THE EMPLOYER’S DUTIES?
The employer must, during the period of reduction of the normal working period:
– Keep the tax and contribution situation regularized;
– Pay punctually the compensation;
– Not increase the salary or other patrimonial benefit attributed to members of social bodies.
The employer may not, during the period of reduction of the normal working period, as well as in the following 60 days:
– Terminate employment contracts under the terms of collective dismissal, dismissal for termination of employment or dismissal for maladjustment;
– To distribute dividends.
WHAT ARE THE WORKERS’ DUTIES?
Should any of the workers covered exercise a remunerated activity outside the company, they must inform the employer of this fact within 5 days from the start of such activity.
The worker must also attend vocational training courses if the employer has requested a training plan.
IS TSU PAYMENT DUE?
During the duration of this support, the employer is entitled to exemption or partial waiver of the payment of the contributions for the employees covered, calculated on the value of the compensation payment.
– Micro, small and medium enterprises:
Total exemption from payment of TSU during the months of August and September;
Partial exemption of 50% of the TSU payment during the months of October, November and December.
– Large Enterprises:
Partial exemption of 50% of the TSU payment during August and September.
For the purpose of verifying the size of the company, the number of workers to be taken into account in a company in the first year of activity, is the number of workers existing in the month of June.
HOW TO APPLY?
To access the financial support for the progressive recovery, the employer must submit an application on a specific form to be made available by Social Security, through the Direct Social Security, together with the employer’s declaration and the certification of the certified accountant that attests to the situation of business crisis.
In parallel, the employer must submit the nominative list of employees to be covered, which must include the social security number, the gross normal pay and the reduction of the normal working period to be applied, in average monthly terms.
The application submitted shall take effect in the month of submission, notwithstanding that, during the month of September, the employer may request that the requested support take effect in the month of August.
Once the support is requested, the employer may, at any time, cease its granting, through the Direct Social Security.
IS IT POSSIBLE TO COMBINE IT WITH A TRAINING PLAN?
It is possible to cumulate a training plan approved by IEFP, I.P. with the extraordinary support for the progressive resumption of activity.
The training plan entitles you to a 30% IAS grant per employee covered, guaranteed by the IEFP, I.P., intended in equal parts for the employer and the employee.
To access a training plan, the employer must submit an application on a specific form to be made available by the IEFP, I.P.