Background information

Due to COVID-19, businesses in the tourism, transport, culture, sports, food and beverage sectors may extend the suspension of their employees' contracts. Businesses that have been financially affected by COVID-19 as per their Activity Code Numbers (ACN), or their operation has been suspended under a state decision, are able  to suspend contracts of employment of part or all of the staff for a continuous period of 45 days. During this period employees’ dismissal is forbidden.

Content of measure

Businesses that have been financially affected as per their Activity Code Numbers (ACN), or their operation has been suspended under a state decision due to COVID-19, can suspend employment contracts of part or of all of the staff for a continuous period of 45 days, during which employees’ dismissal is prohibited. Should a dismissal take place - regardless of whether that dismissal concerns an employee whose employment has been suspended - it will be considered null and void. The employees, whose contracts have been suspended, are entitled to a special purpose compensation of €800 paid by the state for that period. Additionally, they will have full social security insurance calculated on their full salary and the social security contributions will be covered by the state.

The measure has been extended (art. 37, Law 4890/2020, οικ. 23102/477/12.6.2020) for June and July 2020 stating that:

• Businesses in the tourism, transport, culture and sports sectors may suspend their employees' contracts for up to 30 days (consecutively) and in any case up to 31 July 2020. Employers may apply the measure of the suspension gradually and for a different number of employees, up to 100% of them, per statement submitted to the ERGANI (on line reporting system of the Ministry Labour and Social Affairs);
• Businesses in the food and beverage sector may suspend employees' contracts for up to 30 days (consecutively) and in any case up to 30 June 2020. Employers may apply the measure of the suspension gradually and for a different number of employees, up to the percentage of 100% of them, per statement submitted to the ERGANI. The employees of such business are entitled to the exceptional state benefit of €534 depending on the days of suspension. The above businesses are not allowed to terminate employee's contracts for as long as they apply such measures and for 30 days after the expiration of the suspension.

Use of measure

According to OAED's Activity Report from March 2015 to June 2019 there were 4,157 beneficiaries for a total amount of €1,229,799.01.

Strengths: Dismissals can be hindered and at the same time the employer is saving employment costs in times of crisis.

Weaknesses: e-kathimerini newspaper (9 June 2020) sums up the conclusions of the National Institute of Labour and Human Resources (EIEAD): 'More than 940,000 employees in Greece were permanently laid off (4.7%), or had their contract suspended during the peak of COVID-19 crisis (41.8% ). It is estimated that Greece’s rate of suspended contracts could climb to 45% in the private sector, given the €800 subsidies being handed out'.

It is not proved that in times of harsh economic climate this measure alone can hinder business closures.

Target groups

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

Actors and funding

Actors	Funding
National government Company / Companies	Companies Employer National funds

Social partners

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

	Trade unions	Employers' organisations
Role	No involvement	No involvement
Form	Not applicable	Not applicable

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

• No involvement
• Main level of involvement: Unknown

Involvement

Unknown

Views and reactions

Unknown

Sectors and occupations

This case is not occupation-specific.

Sources

• 08 July 2022: Suspension of employment contracts in the fur industry (eservices.yeka.gr)
• 30 September 2022: Extension of the measure of employment contracts' suspension in the Fur industry (eservices.yeka.gr)