Background information

The allowance for the idle time for employees was first introduced in March 2020. With the situation getting better, the state of emergency declared in Latvia on 13 March 2020 as a result of the global COVID-19 pandemic came to an end on 10 June 2020. The allowance was available up to 30 June 2020.

In September COVID-19 spread rate rose sharply and, from 9 November 2020 the state of emergency was declared again, and different restrictions re-introduced.

On 28 November 2020 the Government adopted new regulations No. 709 “On support for taxpayers for downtime to continue their activities during the COVID-19 crisis”. These regulations set out the criteria and procedures for the provision of idle time support to taxpayers – employees and self-employed.

The amount and eligibility criteria of the allowance for the idle time for employees has been changed compared with its predecessor, as well as the minimum amount has been introduced.

Content of measure

The allowance for the idle time for employees is intended as an assistance measure for companies affected by the crisis – to cover costs of retaining employees. The allowance is available from 9 November 2020 till 9 January 2021.

Employers (companies) whose income from economic activity for the specific support month of 2020 has decreased by at least 20% compared to the average income of August, September and October 2020 is eligible for this support. The amount of the allowance for employee is 70% of the average monthly gross work remuneration for the period from 1 August 2020 to 31 October 2020. The amount of the allowance for employee of the company operating in microenterprise tax regime is 50% of the average monthly gross work remuneration for the period from 1 August 2020 to 31 October 2020. It is proposed that the allowance should be at least €330, and it should not exceed €1,000. On 12 January 2021 the Government extended the measure indefinitely until government restrictions apply, and raised the minimum up to €500 (from 1 January 2021).

Although the employer is the one who demands allowance, it is paid directly to employees. Employee can receive allowance with several employers, but the total amount should not exceed €1,000.

Use of measure

From 1 December 2020 to 7 January 2021, the State Revenue Service has paid 25,589 idle time allowances in the total amount of €7,234,780 for employees of 6,118 companies.

From 1 December 2020 to 7 January 2021, accommodation and catering service providers have received 23% of all idle time allowance and wage subsidy support (another measure) costs paid by the SRS, 17% have been paid to companies operating in the wholesale and retail, as well as car and motorcycle repair sectors, and 10% have been paid to companies in the arts, entertainment and leisure sector.

From 1 December 2020 till 11 April 2021 the State Revenue Service has paid 154,992 idle time allowances in the total amount of €66,808,110 for employees of 14,023 companies.

From 1 December 2020 till 11 April 2021, accommodation and catering service providers have received 29.2% of all idle time allowances paid by the SRS, 27% have been paid to companies operating in the wholesale and retail, as well as car and motorcycle repair sectors, and 12% have been paid to companies in the arts, entertainment and leisure sector.

From 1 December 2020 till 18 July 2021 the State Revenue Service has paid 247,825 idle time allowances in the total amount of €111,980,072 for 62,189 employees.

From 1 December 2020 till 18 July 2021, accommodation and catering service providers have received 22.5% of all idle time allowances paid by the SRS, 31% have been paid to companies operating in the wholesale and retail, as well as car and motorcycle repair sectors, and 8% have been paid to companies in the arts, entertainment and leisure sector.

From 1 December 2020 till 18 July 2021 the State Revenue Service has paid 253,679 idle time allowances in the total amount of €114,440,028 for 62,231 employees.

Target groups

Workers	Businesses	Citizens
Employees in standard employment	Applies to all businesses	Does not apply to citizens

Actors and funding

Actors	Funding
National government	National funds

Social partners

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

	Trade unions	Employers' organisations
Role	Consulted	Consulted
Form	Direct consultation outside a formal body	Direct consultation outside a formal body

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

• Unknown
• Main level of involvement: Peak or cross-sectoral level

Involvement

Peak level social partners’ organisations normally are informed on Government decisions. Regarding COVID-19 measures social partners participate in working groups and depending on their capacities are involved in consultations and negotiations.

Views and reactions

Latvian Employers’ confederation informed that employers are in favour of raising the minimum threshold for idle time benefits to €500, but believe that the maximum amount of benefits and wage subsidies should be reviewed, taking into account the employee's social security contributions as well as dependents.

Sources

• 28 November 2020: The regulation on idle time support and wage subsidy enters into force (lvportals.lv)
• 28 November 2020: regulations Nr. 709 On support for taxpayers for downtime to continue their activities during the Covid-19 crisis (likumi.lv)
• 08 January 2021: The SRS has paid downtime and wage subsidy support in the amount of 11.1 million euros (www.vid.gov.lv)
• 12 January 2021: Support for businesses for downtime and part-time employees will be available as long as economic activity is restricted (www.mk.gov.lv)
• 13 January 2021: Employers are urging to improve the criteria for receiving crisis support (www.db.lv)
• 27 July 2021: Statistics on support from the State Revenue Service (www.vid.gov.lv)
• 15 September 2021: State Revenue service statistics 15 September 2021 (www.vid.gov.lv)