The amendment ZIUZEOP-A changed the rules and conditions for employers claiming aid
On 28 April 2020, the National Parliament of the Republic of Slovenia adopted an amendment to the Act Determining the Intervention Measures to Contain the COVID-19 Epidemic and Mitigate its Consequences for Citizens and the Economy (ZIUZEOP-A), amending the rules and the conditions under which employers may exercise their right to various forms of government aid. In the field of labour law, the amendment eliminated some previous dilemmas and ambiguities, but at the same time opened many new ones.
Among the new provisions of the Act Determining the Intervention Measures to Contain the COVID-19 Epidemic and Mitigate its Consequences for Citizens and the Economy (ZIUZEOP), Article 20a is certainly the most important, introducing two new restrictions on the granting of aid under labour law measures provided by ZIUZEOP to employers, namely (i) the exclusion of so-called “Firms in difficulty” (which were in such a situation on 31 December 2019) among the recipients of the aid; and (ii) a limit on the amount of public funds that an individual firm may receive. Employers (with the exception of those from some industries specifically listed in the law) can count on aid in the total of a maximum of 800,000.00 EUR, whereby the law also provides for exceptions under which an individual company is entitled to higher aid.
The amendment to Article 22 of ZIUZEOP is also crucial, which instead of the current conditions for the employer’s entitlement to legal measures (more than 20% decrease in revenues in the first half of 2020 and a maximum of 50% higher revenues in the second half of 2020 compared to the same period in 2019) offers a new condition, namely that all those employers who will have at least 10% lower incomes in 2020 compared to 2019 are entitled to the aid. Unchanged, however, is an obligation on the part of the employer to repay the funds if it subsequently turns out that he has not fulfilled the condition of falling income.
The amendment now also classifies smaller employers (maximum ten employees on 13 March 2020) who perform financial or insurance activities as beneficiaries of assistance (due to temporary measures under labour law).
So far, a lot of ambiguity has been caused in practice (also) by the provision of Article 24 of ZIUZEOP, which determines for how many days an employer can call a worker who has been furloughed back to work in an individual month. Under the new law, the employer will be able to call the employee back to work for a maximum of seven (7) days in a given month (during the duration of the furlough), but there is no longer a restriction that these can only be consecutive days – now this can be any seven days in a calendar month. At the request of the unions, however, this article was also amended in part, which now stipulates that such a return to work is a worker’s right (and no longer an obligation). If the legislator actually wanted to determine that a worker has the right to refuse to return to work (without any consequences), this will cause a lot of confusion and problems in practice, as employers will find it even more difficult to plan the work process in the current uncertain situation and fluctuating work needs (as they will first have to offer the job to a furloughed worker, who will then reject it). In any case, it seems illogical that a worker should be able to choose whether to respond to a call to work or instead receive compensation at the expense of the state (since the purpose of this measure is to help only those employers and workers for whom there is no temporary work).
The provision of Article 33 of ZIUZEOP regarding the partial exemption of contributions for pension and disability insurance for the duration of statutory measures has also been amended, which more clearly determines to whom the exemption applies, i.e. to workers who are not furloughed or absent from work due to force majeure under this Act. In this regard, FURS explained on its website that the exemption from the payment of contributions for PIZ is recognized from the paid salaries also e.g. for the time when employees are on leave or sick leave and receive salary compensation in accordance with the second and third paragraphs of Article 137 of ZDR-1 and all other salary compensations paid on the basis of ZDR-1, except for compensations for which ZDR-1 already provides the exemption of all contributions. The exemption refers to wages and salaries paid for work during the epidemic but cannot be claimed by the employer from bonuses and other non-wage income. Exemption from the payment of PIZ contributions according to ZIUZEOP cannot be claimed by the employer from the compensation of salary due to sick leave, which is reimbursed by the ESS.
The amendment also clarifies how to calculate the amount of crisis allowance to which a worker (whose salary does not exceed 2,821.74 EUR gross) is entitled to in a given month, taking into account the principle of proportionality, according to which the worker receives crisis allowance for days on which he actually works (and on holidays and other non-working days on which he would otherwise work). Employers whose working hours are unevenly distributed must take into account the actual number of hours the worker has worked during that time, and not just the contractually agreed (average) working hours.
The principle of proportionality is also applied in the case of part-time workers – however, those workers who are entitled to part-time work are entitled to the same crisis allowance as full-time workers. on the basis of special regulations (e.g. parental care, partial sick leave, disability, etc.).
With Article 33.a, the legislator also exempted employers from paying compulsory contributions for occupational insurance for the duration of the measures, whereby employers must explicitly claim this exemption from the manager of the Compulsory Supplementary Pension Insurance Fund.
A new Article 61a has also been added, which regulates the right to temporary cash benefits for persons who do not otherwise meet the conditions for obtaining unemployment benefits under the Labour Market Regulation Act (ZUTD) and whose employment contract has been terminated for business reasons or with the expiry of the period for which it was concluded (from 13 March 2020 onwards). These persons are entitled to a monthly allowance in the amount of 513.64 EUR even if they would not otherwise be entitled to this allowance under the provisions of ZUTD.
Article 99 of ZIUZEOP has also been substantially amended, which stipulates that in the event of payment of profits (in 2020, from the entry into force of ZIUZEOP or at any time after 2020 for the year 2020), purchase of their own shares or payment of rewards or part of the salary for business performance of managers, employers must return some aid, which has been received. While before the amendment, the obligation to return applied to all refunds of wage compensation received by the employer and also to all social security contributions from which he was exempted (both for wages and for wage compensation), the employer now, in the case of payments listed in Article 99 of ZIUZEOP, will not need to return the subsidized amount of salary compensation to a worker who cannot work due to force majeure, as well as pension and disability insurance contributions for those workers in the private sector who are working.
The amended provision also sets a deadline by which the beneficiary must notify the Financial Administration of the Republic of Slovenia (FURS) of its (subsequent) finding that it does not meet the conditions for individual forms of assistance under ZIUZEOP, i.e. it must do so by the deadline for corporate income tax returns for 2020 or by the deadline for submitting the calculation of income tax from activities for 2020. The beneficiary must return the amount of aid received within 30 days of service of the FURS decision, in case of delay together with statutory default interest.
The amendment also stipulated in the transitional provisions (if we disregard the obvious error in referring to the articles of ZIUZEOP-A instead of the articles of ZIUZEOP) the retroactive application of individual provisions of the amendment, which introduces a lot of uncertainty about the conditions under which employers e.g. will be eligible for aid in April. Article 51 of ZIUZEOP-A stipulates that employers who have already submitted their applications for assistance by 30 April 2020 will be treated in accordance with the provisions of the amendment, if these are more favourable for them, which indicates that the law should not allow interventions into acquired rights of employers, but in this regard the competent authorities have not yet taken completely clear positions (especially, for example, for so-called “firms in difficulty”, on measures taken before 30 April 2020, but for which, for example, the employer has not yet received compensation refunds, etc.). For these reasons – especially in the light of frequent changes in legislation and occasionally conflicting interpretations of the law by various bodies – there is still some uncertainty and ambiguity about what the changes will bring in practice.
The amendment also extends the deadline for submitting an application or declaration on the basis of ZIUZEOP (for measures that were in place before the amendment came into force, but for which employers have not yet applied for), which expires on 8 May 2020.
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