Background information

The scheme aims to combat unemployment through the provision of incentives for employers in order to hire unemployed people. The incentives refer to the subsidy of the employment cost of the hired unemployed people. The scheme is part of the active employment policy of the government promoting the inclusion of the unemployed in the labour market through subsidised jobs that include the provision of occupational training. The legal base of the scheme is the decision of the Cabinet of the 7 October 2020 for the projects that may be co-financed by the European Social Fund and the Republic of Cyprus. The Department of Labour of the Ministry of Labour, Welfare and Social Insurances is the coordinator agency of the Scheme.

Content of measure

Eligible employers and enterprises are those performing entrepreneurial activities in the areas controlled by the Republic of Cyprus, registered as employers in the Social Insurances Registry and have not been convicted for violations of the Minimum Income Decree or the legislation on illegal and undeclared employment. An additional eligibility criterion is that the enterprise applying for participation has not dismissed anyone since the 1 March 2020 and the begging of the crisis due to the pandemic.

The maximum number of people that an employer may hire within the frame of the scheme is five people. Additionally, the employment of a person within the scheme shall contribute to the increase of the number of employees in the enterprise performing the same profession with the person that is hired.

Eligible people are the unemployed people registered at the Public Employment Services, at least one day prior the hiring day, citizens of the Republic, EU citizens or Third Country Nationals legally reside in the Republic having the right of free access in the labour market of the Republic.

The total budget that is available for the scheme is €17 million. The subsidy that the enterprise receives for each hired person is €870 for the first six months and €924 for the rest. The subsidy to the employer is granted for the first ten months and the employer is obligated to cover additional two months. The maximum annual subsidy that is granted for one person to the enterprise is €8,600.

Use of measure

For the moment, there is no assessment that indicates the number of business and/or workers that may have benefited from the scheme.

Target groups

Workers	Businesses	Citizens
Unemployed	Applies to all businesses	Does not apply to citizens

Actors and funding

Actors	Funding
National government Company / Companies Public employment service	European Funds National funds

Social partners

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

	Trade unions	Employers' organisations
Role	Informed	Informed
Form	Not applicable	Not applicable

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

• No involvement
• Main level of involvement: Unknown

Involvement

The Scheme and its related provisions, terms and eligibility criteria has been designed exclusively by the Ministry of Labour, Welfare and Social Insurances. Social partners have not been invited by the Ministry into a consultation process for the definition of the scheme. They have only been informed, at an earlier stage, by the Ministry for its intention for the launching of the Scheme.

Views and reactions

Social partners are in favour of measures that encourage the employment of particular groups of workers and the incentives that are provided to businesses for the employment of the unemployed. They appear supportive to this governmental initiative and no reactions or disagreements on the provisions of the scheme have been recorded to this moment.

Sources

• 23 October 2020: Σχέδιο παροχής κινήτρων για την εργοδότηση ανέργων (www.mlsi.gov.cy)