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COVID-19 EU PolicyWatch

Database of national-level responses

Eurofound's COVID-19 EU PolicyWatch collates information on the responses of government and social partners to the crisis, as well as gathering examples of company practices aimed at mitigating the social and economic impacts.

Factsheet for case CY-2020-11/327 – measures in Cyprus

Special scheme for complete suspension of business

Ειδικό σχέδιο πλήρους αναστολής εργασιών της επιχείρησης

Country Cyprus , applies nationwide
Time period Temporary, 11 March 2020 – 12 June 2020
Type Legislations or other statutory regulations
Category Employment protection and retention
– Income support for people in employment (e.g. short-time work)
Author Loucas Antoniou (INEK) and Eurofound
Case created 07 April 2020 (updated 06 May 2020)

Background information

The scheme addresses businesses who have completely suspended their operation, in accordance with the Decree 101 of the Quarantine Law, Chapter 260 of the Minister of Health. It includes hypermarkets, shopping malls, cafeterias, libraries, sport centers, thematic parks, hairdressing saloons, barber shops, night clubs and pubs, etc.

On Wednesday 8 April, the President of the Republic announced the decision of the Cabinet to extent the measure up until 12 June 2020. Currently, the Ministry of Labour undertakes a legal and technical processing of the measure.

Content of measure

The basic requirement for participation in the Scheme is that no employee has been fired since 1 March 2020. Additionally, businesses participate in the Scheme should not dismiss any employee during the period of participation, during an additional equal period of participation and plus one additional month after the end period of participation.

For companies employing more than nine employees, a Special Unemployment Benefit will be paid to 90% of employees, provided the terms and conditions are met. The remaining 10% shall include managing shareholders, partners holding more than 20% of the shares, general managers and senior executives. For businesses employing up to nine employees, Special Unemployment Benefit may be paid to all employees of the business, irrespective of their status

The maximum amount that may be paid for a period of month may not exceed €1,214.

On the 23 April 2020, the Cabinet amended the calculation of the payable amount to the beneficiaries in order to support as many employees as possible. For the purpose of paying the Scheme, the insurable earnings of the year 2018 will be taken into account, but in addition, a comparison will be made based on the declared salary of January 2020. The payable amount will be the highest amount that results from this comparison.

Additionally, a minimum payable amount of 356 euros has been defined for beneficiaries. Also, a special plan will be implemented for employees who first started work in February and March 2020.

The Scheme includes persons over 65 years of age who do not receive statutory pension and continue to work.

In addition, those for whom the regular unemployment benefits from the Social Insurance Fund have been completed, may join the Scheme to receive a Special Unemployment Allowance.

Use of measure

The budget available for the scheme is 182 million euros (covering the Scheme for the partial suspension of business Decree 130) but there is no estimation of the number of beneficiaries at this moment.

Target groups

Workers Businesses Citizens
Employees in standard employment
Sector specific set of companies
SMEs
Does not apply to citizens

Actors and funding

Actors Funding
National government
Social partners jointly
Trade unions
Employers' organisations
Company / Companies
Social insurance
National funds

Social partners

Social partners' role in designing the measure and form of involvement:

Trade unions Employers' organisations
Role Agreed (outcome) incl. social partner initiative Agreed (outcome) incl. social partner initiative
Form Direct consultation outside a formal body Direct consultation outside a formal body

Social partners' role in the implementation, monitoring and assessment phase:

  • N/A
  • Main level of involvement: Peak or cross-sectoral level

Involvement

N/A

Views and reactions

The Government has consulted the social partners - trade unions, employers´ organizations and all political parties - the provision of the scheme and the outcome emerged is on an agreed base.

Sources

  • 07 April 2020: Special Scheme for Complete Suspension of Business (www.coronavirus.mlsi.gov.cy)
  • 23 April 2020: Τη λήψη επιπρόσθετων μέτρων στήριξης των εργαζομένων αποφάσισε το Υπουργικό Συμβούλιο (www.pio.gov.cy)

Citation

Eurofound (2020), Special scheme for complete suspension of business, case CY-2020-11/327 (measures in Cyprus), COVID-19 EU PolicyWatch, Dublin, http://eurofound.link/covid19eupolicywatch

Disclaimer: This information has not been subject to the full Eurofound evaluation, editorial and publication process. All information is preliminary and subject to change.