Eurofound's EU PolicyWatch collates information on the responses of government and social partners to the COVID-19 crisis, the war in Ukraine, rising inflation, as well as gathering examples of company practices aimed at mitigating the social and economic impacts.
Factsheet for measure LV-2020-46/1715 – Updated – measures in Latvia
|Country||Latvia , applies nationwide|
|Time period||Temporary, 09 November 2020 – 30 June 2021|
|Type||Legislations or other statutory regulations|
Employment protection and retention
– Income support for people in employment (e.g., short-time work)
|Author||Kriss Karnitis (EPC) and Eurofound|
|Measure added||14 January 2021 (updated 26 May 2022)|
From 9 November 2020 the state of emergency due to COVID-19 pandemic was declared again, and different restrictions re-introduced.
On 28 November 2020 the Government adopted new amendments to regulations No. 675 "On the provision of support to taxpayers to continue their activities in the context of the COVID-19 crisis". The regulation describes criteria and procedure for granting support to short time employees (wage subsidy).
Wage subsidy for employees is intended as an assistance measure for companies affected by the crisis – to cover costs of retaining employees who work for a lower number of hours. The allowance is available from 9 November 2020 until 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 subsidy for an employee is 50% from average gross wage in August, September and October 2020, but not exceeding €500.
The employer is obliged to pay the employee the difference between the subsidy and the amount of full wage. The employer should retain an employee employed an extra month after the period of receiving the subsidy.
Although the employer is the one who demands subsidy, it is paid directly to employees.
From 1 December 2020 to 7 January 2021, the State Revenue Service has paid 11,240 wage subsidies in amount of €2,466,603. 30.93% of companies receiving subsidies operate in HORECA, 28.46% in wholesale and retail trade, and 11.88% in manufacturing.
In the time period from 1 December 2020 to 11 April 2021 the State Revenue Service has paid 56,159 wage subsidies in the amount of €15,800,120. 9,246 of those receiving wage subsidies were employed in wholesale and retail trade (NACE G). 17,006 subsidies were paid in the sector in the total amount of €4.7 million. The the second largest recipient with 5,695 employed receiving wage subsidies is HORECA (NACE I). In this sector 13,698 subsidies were paid in the total amount of €3.6 million. The third largest recipient with 3,623 employed receiving wage subsidies is manufacturing (NACE C). In this sector 7,681 subsidies were paid in the total amount of €2.3 million.
In the time period from 1 December 2020 to 18 July 2021 the State Revenue Service has paid 62,189 wage subsidies in the amount of € 22,761,663. 9,843 of those receiving wage subsidies were employed in wholesale and retail trade (NACE G). 21,904 subsidies were paid in the sector in the total amount of €6.06 million. The the second largest recipient with 6,785 employed receiving wage subsidies is HORECA (NACE I). In this sector 23,927 subsidies were paid in the total amount of €6.5 million. The third largest recipient with 3,932 employed receiving wage subsidies is manufacturing (NACE C). In this sector 9,873 subsidies were paid in the total amount of €3 million.
In the time period from 1 December 2020 to 29 August 2021 the State Revenue Service has paid 81,881 wage subsidies in the amount of €23,357,120.
Employees in standard employment
||Applies to all businesses||Does not apply to citizens|
Social partners' role in designing the measure and form of involvement:
|Trade unions||Employers' organisations|
|Form||Direct consultation outside a formal body||Direct consultation outside a formal body|
Social partners' role in the implementation, monitoring and assessment phase:
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.
Latvian Employers’ confederation informed that employers believe that the maximum amount of wage subsidies should be reviewed, taking into account the employee's social security contributions as well as dependents.
Eurofound (2021), Wage subsidy for short time employees, measure LV-2020-46/1715 (measures in Latvia), EU PolicyWatch, Dublin, https://static.eurofound.europa.eu/covid19db/cases/LV-2020-46_1715.html
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Disclaimer: This information has not been subject to the full Eurofound evaluation, editorial and publication process.