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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 SI-2020-11/436 Updated – measures in Slovenia

Temporary layoff scheme and reimbursement of related wage compensation to employers

Povračilo izplačanih nadomestil plač

Country Slovenia , applies nationwide
Time period Temporary, 13 March 2020 – 30 April 2021
Type Legislations or other statutory regulations
Category Employment protection and retention
– Income support for people in employment (e.g. short-time work)
Author Maja Breznik (University of Ljubljana) and Eurofound
Case created 10 April 2020 (updated 17 March 2021)
Related ERM support instrument

Background information

This measure, introduced in the framework of the 'Intervention measures to mitigate the effects of the SARS-CoV-2 (COVID-19) infectious disease epidemic on citizens and the economy Act (ZIUZEOP)', in force since 11 April 2020, aims at the protection and retention of jobs. In response to the COVID-19 crisis, the government adopted a ‘temporary lay-off scheme’ and reimbursement of wage compensations to workers who cannot work due to force majeure. The measure addresses laid-off workers for whom company temporary fails to provide work and workers who cannot work due to force majeure:

  • workers in quarantine, who cannot work from home;
  • workers who look after children during the closure of schools and kindergartens;
  • workers who cannot come to work on the grounds of the suspension of public transport or ban on the border crossing.

Content of measure

According to the Employment Relationship Act, when a company temporarily fails to provide work for business reasons (in the event of a temporary layoff), the worker is entitled to wage compensation in the amount of 80% of the wage basis. The wage basis is determined at the worker’s average monthly wage for full-time work during the past three months. On the other hand, if a worker cannot carry out his work due to force majeure, he is entitled to half of the payment he would have received if he was working, but not less than 70% of the minimum wage. The temporary laid-off worker is obliged to respond to the employer’s invitation in a manner and under the conditions laid down in the lay-off letter (Employment Relationship Act, Articles 137, 138).

The measure being examined, attempting to cushion the economic effects of the COVID-19 epidemic, grants the employers with 80% reimbursement of the sums payed to provide the economic treatment mentioned above to workers (in case of temporary lay-off as well as force majeure). This reimbursement is funded with the state budget. Reimbursement is limited to the average monthly salary in 2019 and cannot be lower than the minimum wage (it is thus higher than statutory determined compensations).

The maximum length of receiving compensation is from 13 March to 31 May. To be eligible for the reimbursements, a company had to demonstrate a 20% lower income in the first half of 2020 and 50% lower income in the second half of 2020, compared to 2019.

Updates

The following updates to this measure have been made after it came into effect.

29 December 2021

The seventh COVID-19 law (ZIUPOPDVE), adopted by the Parliament on 29 December 2020, stipulates that wage compensations for workers in quarantine or workers who cannot work due to force majeure cannot be lower than minimum wage.

It also says that companies are criminally and materially liable if they do not pay wage compensation to workers or if they submit a false statement. A fine of between €3,000 and €20,000 can be imposed on an employer (and on a responsible person a fine between €450 and €2,000) if he gives false statement or does not pay wage compensation to workers (fine between €1,500 and €8,000 for an employer which employs a maximum of 10 workers, and between €450 and €1,200 for a solo entrepreneur). If a company a posteriori realizes that sales revenues have exceeded the ‘temporary layoff scheme’ threshold, Article 89 obliges the company to report the result to the Financial Administration and return state support. The government extended measure until 31 March 2021.

03 February 2021

The eight COVID-19 law (ZDUOP), adopted on 3 February 2021, extends the temporary layoff scheme until 30 April 2021 (and further on until 30 June upon the government’s decree). Eligible are companies registered until 31 December 2021 under the condition they have a 20% lower income compared to the year 2019 or 2020. Government reimbursement can cover 80% wage compensation up to the average monthly pay in October 2020. Reimbursement can attain 100% wage compensation (but not more than the average monthly payment) if a company has received less than €1.8 million of state support in total (or €270,000 in fishing and aquafarming, €225,000 in agriculture). The state pays full social contributions to sectors closed due to the pandemic.

25 November 2020

The sixth COVID-19 law (ZIUOPDVE), adopted by the Parliament on 25 November 2020, extends the measure until the 31 January 2021. Eligible are companies under the condition they have a 20% lower income compared to the year 2019. Since November 2020, the government refunds 80% of the wage basis, but the maximum limit is the average wage (not the maximum unemployment benefit as before). Government reimbursement can cover 100% wage compensation if a company has received less than €800,000 of state support in total.

Extended are also the wage-related compensations for workers in quarantine and workers who cannot work due to the ban on border crossing or shutdown of the public transport or childcare due to the closure of schools until 31 December 2020. The measure can be prolonged for another six months upon the government’s ordinance.

15 October 2020

The fifth emergency law (ZZUOOP), adopted by the Parliament on 15 October 2020, extends the measure until the end of the year 2020. Companies are eligible under the condition they have 20% lower income compared to the year 2019. The measure may be extended for another six month (until 30 June 2021) in accordance with the Temporary Framework for State aid measures to support the economy in the current COVID-19 outbreak 2020 . The following support measures are also extended (which can be prolonged for another six months upon the government’s ordinance):

  • 100% wage compensation paid by the employer to a worker, infected at work;
  • 90% compensation for an infected worker, paid by the state (compensation increases to 100% after 90 days of illness);
  • 80% compensation for a worker in quarantine, paid by the state;
  • a higher 80% compensation since 1 September 2020 for a parent who takes care of a child in quarantine, paid by the state (eligible are children until fifth grade and disabled children).

New is the right of employees to the three-day absence from work due to illness without the doctor’s certificate. Wage compensation is paid by the Health Insurance Institute. Employees can use this measure only once.

09 July 2020

The fourth COVID-19 law Act on Intervention Measures to Prepare for the Second Wave COVID-19 (ZIUPDV) was adopted on 9 July 2020. The act extends measure to 31 July 2020 whereby the government has the right to extends it to September 2020. On the initiative of employer organisations, reimbursement of wage compensation was indeed extended to September 2020. Up to August 2020, €269 million was reimbursed to employers for wage compensation.

The Act also gives the right of reimbursements to workers who cannot work due to quarantine. The worker, who would get in contact with an infected person at work, receives 100% wage compensation. The worker, who would have to be in quarantine since the return from the country on the green or yellow list or who would get in contact with an infected person outside work, receives 80% wage compensation. Since the return from the country on the red list, the worker in quarantine is not entitled to wage compensation. However, there are some exceptions: the death of parents and a spouse, partner or child, the birth of a child. In these cases, the worker receives 70% of wage compensation. The measure will expire by 30 September 2020.

02 July 2020

The second COVID-19 law (ZIUZEOP-A) lowered the eligibility threshold for companies. All enterprises with income reduced by 10% in 2020 compared to 2019 can now be admitted to this measure. Newly established companies can prove 10% lower income on the basis of average monthly income with the pre-crisis period. The third COVID-19 law (ZIUOOPE) extends measure to June 2020, whereby the maximum reimbursement is limited to €892.50 (the maximum of unemployment benefit). Reimbursement of wage compensation will be most probably again extended to September 2020. The employer must cover the remaining 20%. Government’s reimbursement includes social security compensation. The measure will be most probably again extended to September 2020

Use of measure

Companies that are not eligible are:

  • State institutions.
  • Financial and insurance companies with more than 10 employees.
  • Companies having outstanding debt with the Financial Administration.
  • Foreign or international organisations (not including humanitarian and disability organisations).

The Employment Service of Slovenia administers employers’ requests for compensations. Up to 31 May, the Employment Service received requests for wage compensation for 275,317 employees and additional 54,168 since 1 June.

According to the Ministry of Labour, Family, Social Affairs and Equal Opportunities data, employers submitted 46,009 applications for wage reimbursement of 275,317 employees under the first and second emergency laws (adopted in the period from 13 March to 31 May 2020). Under the third emergency law (adopted in June 2020), employers submitted 10,930 applications for 64,667 employees. Under the fourth emergency law, there were 6,787 applications for almost 24,200 employees by 20 July 2020. Until September 2020, the government paid off €281 million to employers for temporary layoff scheme.

Unlike the short-time scheme, the temporary layoff scheme this was very well accepted by employers who demanded the prolongation of this measure. It is commonly believed that registered unemployment would be much higher without the temporary layoff scheme. The registered unemployment was 9.2 per cent in July 2020, while it was 7.4% at the same time in 2019 (source: Employment Service of Slovenia).

Target groups

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

Actors and funding

Actors Funding
National government
Social insurance
European Funds
National funds

Social partners

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

Trade unions Employers' organisations
Role Consulted Consulted
Form Any other form of consultation, institutionalised (as stable working groups or committees) or informal Any other form of consultation, institutionalised (as stable working groups or committees) or informal

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

  • Unknown
  • Main level of involvement: Unknown

Involvement

No information available yet.

Views and reactions

Trade unions and employer organizations have submitted many proposals to the law, mainly for clarifying the definitions. In first reactions, employers protested against the rule requesting 20% lower incomes. They said that it would exclude many companies from the support mechanism (Mekina, 2020). The government agreed to employer organisations and lowered the threshold to 10% in the second COVID-19 law ZIUZEOP-A, issued on 30 April 2020. They argued that state support shouldn’t stimulate companies to work less.

Trade unions demanded a fixed period of six months after the epidemic in which employers shouldn’t lay off workers for business reasons. Some proposals were accepted but not these two.

The law was adopted under an accelerated procedure with no involvement of the Economic and Social Council. It was blocked because the new government, which came to power on 13 March 2020, had not yet appointed its members in the Economic and Social Council. While employer organisations achieved a lower threshold (reduction of company income by 10% compared to the pre-crisis level in the second COVID-19 law ZIUZEOP-A, issued on 30 April 2020), trade unions were less successful. They demanded a temporary ban (of three months after the epidemics) on dismissals of workers for whom companies receive reimbursement of wage compensation. The legislator has not agreed to their proposal, so emergency laws do not determine temporary employment security and workers can be dismissed when state subsidies expire.

Sources

  • 28 March 2020: Zakon o interventnih ukrepih na področju plač in prispevkov, ZIUPPP [Act on the Interim Measure of Partial Reimbursement of Wage Compensation], Official Gazette RS, no. 36, 202 (www.pisrs.si)
  • 06 April 2020: Financial Administration, 'Preglednica ukrepov' [Table of measures] (www.gov.si)
  • 10 April 2020: Zakon o interventnih ukrepih za zajezitev epidemije COVID-19 in omilitev njenih posledic za državljane in gospodarstvo (ZIUZEOP) [Act Determining the Intervention Measures to Contain the COVID-19 Epidemic and Mitigate its Consequences for Citizens and the Economy (www.pisrs.si)
  • 10 April 2020: Borut Mekina, ‘Pravljica o mega protikoronskem paketu’ [A fairy tale about a mega anti-corona package], Mladina, 10 April 2020 (www.mladina.si)
  • 30 April 2020: Zakon o interventnih ukrepih za zajezitev epidemije COVID-19 in omilitev njenih posledic za državljane in gospodarstvo, ZIUZEOP-A [Act Determining the Intervention Measures to Contain the COVID-19 Epidemic and Mitigate its Consequences for Citizens and the Economy (www.uradni-list.si)
  • 30 May 2020: Zakon o interventnih ukrepih za omilitev in odpravo posledic epidemije COVID-19 (ZIUOOPE) [Act Determining the Intervention Measures to Mitigate and Remedy the Consequences of the COVID-19 Epidemic (www.uradni-list.si)
  • 19 June 2020: M. Z., Za subvencioniranje skrajšanega delovnika prijavljenih že 20.500 zaposlenih [20,500 employees requested subsidies for short-time work], MMC RTVSL (www.rtvslo.si)
  • 10 July 2020: Zakon o interventnih ukrepih za pripravo na drugi val COVID-19 [Act on Intervention Measures to Prepare for the Second Wave COVID-19] (ZIUPDV (www.uradni-list.si)
  • 27 August 2020: Nejc Gole, ‘Ukrep čakanja na delo do konca septembra’, Delo, 27 August 202 (www.delo.si)
  • 15 October 2020: Act Determining the Intervention Measures to Contain the COVID-19 Epidemic and Mitigate its Consequences (Zakon o začasnih ukrepih za omilitev in odpravo posledic covid-19, ZZUOOP)
  • 25 November 2020: Zakon o interventnih ukrepih za omilitev posledic drugega vala epidemije COVID-19 (ZIUOPDVE) [Act Determining Intervention Measures to Remedy the Consequences of the Second Wave of COVID-19 Epicemic (www.iusinfo.si)
  • 30 December 2020: Act Determining Intervention Measures to Assist in Mitigating the Consequences of the Second Wave of COVID-19 Epidemic (Zakon o interventnih ukrepih za pomoč pri omilitvi posledic drugega vala epidemije COVID-19, ZIUPOPDVE (pisrs.si)
  • 04 February 2021: Act on Additional Measures for Mitigation of Consequences COVID-19 (Zakon o dodatnih ukrepih za omilitev posledic COVID-19, ZDUOP (www.pisrs.si)

Citation

Eurofound (2020), Temporary layoff scheme and reimbursement of related wage compensation to employers, case SI-2020-11/436 (measures in Slovenia), 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.