N E W S R E P O R T V A P L A W A P R I L 2 0 2 0
Coronavirus and Employment Landscape
Extraordinary Support Measures for Enterprises
The quick worldwide proliferation of the SARS-CoV-2, known as coronavirus, is an unprecedented situation, which has overturned the employment landscape and the performance of contractual relationships and obligations. With the publication of numerous Legislative Decrees (LD) and Ministerial Decisions (MD) the extraordinary support measures for the society and entrepreneurism were enacted, in order to smooth the market conditions and operation. The major support measures are regulated by the LDs dated 11.03.2020/2020 (Gov. Gazette Α’ 55/11-03-2020) and 20.03.2020 (Gov. Gazette Α’ 68/20-03-2020) as well as the Joint Ministerial Decision No 12998/232/23.3.2020 of the Ministers both of Finance and Labour and Social Affairs.
Let’s have a look of the new conditions formed in the work landscape and how an enterprise can overcome difficulties and continue its operation with the least possible losses.
The following organizational measures have been provided for:
(A) Suspension of employment contracts
(B) Teleworking (home office)
(C) Special purpose leave
(D) Security personnel and
(E) Intra-group transfer of personnel.
A brief description with the most important questions and answers in relation to the above measures follows below. We point out that these measures concern both the enterprises, whose operation has been suspended by order of a public authority/the State, and the enterprises, which have been negatively affected by the pandemic. These organizational measures are accompanied by further measures of a financial nature, which are also set out below.
(A) SUSPENSION OF EMPLOYMENT CONTRACT
1. Who are entitled to suspend their employment contract?
The ability to suspend the employment contracts of their personnel is provided both for the enterprises, whose operation has been suspended, and for the enterprises, which have been affected by the pandemic.
2. When must the suspension be declared and how long does it last?
(a) The suspension of the employment contracts must be declared for the enterprises who has suspended their operation until 10.04.2020 and the enterprises affected by the pandemic until 20.04.2020. Declaring the suspended contracts may gradually take place until the final date provided for, unless Ministerial Decision extends such final date.
(b) For the enterprises, which suspended their operation following the order of a public authority, the suspension of the employment contracts lasts for as long as the relevant order of the pubic authority lasts as well.
(c) For the affected enterprises, the suspension of each employment relationship lasts for 45 calendar days from the date it will be declared in the “ERGANI” IT System. This period of 45 days is consecutive and cannot be revoked.
Example: An enterprise included in the affected Activity Codes (ΚΑΔ), employs a total of 16 employees under employment contracts of indefinite term. Initially the enterprise decides to suspend 2 employment contracts on 01.04.2020 for 45 days, i.e. until 15.05.2020. Thereafter, it decides to suspend 1 more employment contract on 12.04.2020 for 45 days as well, until 27.05.2020. Finally, it decides to suspend 2 more employment contracts on 20.04.2020 until 04.06.2020. After 20.04.2020 it cannot suspend any other contract, unless the relevant deadline is extended by Ministerial Decision.
3. Is it possible for the all employment contracts to be suspended?
3.1. These extraordinary provisions provide that as regards the enterprises whose operation is suspended, the suspension of employment contracts excludes:
(a) Employees under a teleworking regime (home office),
(b) Employees who have taken a legal leave,
(c) Security personnel and
(d) Employees, whose employment relation is not suspended due to the prohibition of operation of the enterprises.
3.2. Unpaid leaves, which have been agreed between employees and enterprises-employers, whose business activity has been suspended by order of a public authority, are ipso factor cancelled from 28.03.2020. The employment contracts of these employees are suspended and there are entitled to receive the special purpose severance. As regards the unpaid leaves, they may be deemed to include the following leaves:
(a) Child care leave (“breastfeeding”),
(b) Parental leave (“child upbringing”),
(c) Special leave for parents with children suffering from a disease requiring hemodialysis or blood transfusion, as well as children severe mental disorders or Down syndrome,
(d) Single-parent leave,
(e) Marriage leave and birth leave, and
(f) Leave due to death of a family member/relative.
All above leaves are suspended, the waged person/employee is suspended and the leaves continue regularly after the end of the suspension period.
3.2. As regards the exception in which the waged person/employee has taken “any legal leave”, this may include:
(a) Regular leave (ACT 539/1945),
(b) Birth and childbed leave,
(c) Special maternity protection leave (6 months, art. 142 of Law. 3655/2008),
(d) Special purpose leave, due to the coronavirus.
(e) For affected enterprises the above restrictions are not expressly imposed. However, for the identity of the legal rationale (since it concerns the same benefit, extent and justifying cause), the above exceptions must also apply to the affected enterprises.
4. Is the enterprise-employer obligated to inform employees that their contracts are suspended?
After filing in the “ERGANI” IT System the Employer’s Solemn Declaration, the enterprises-employers are obligated to communicate it in writing or by email on the same day to their employees, stating the filing protocol number
5. Are there any restrictions for the employer if the employment contracts are suspended?
The employer suspending even one employment contract is bound by a personnel non-dismissal clause for as long as the suspension is in force. In parallel, it is bound for a respective period, after the end of the suspension, to preserve the same number of employees (i.e. both by a non-dismissal clause, and a clause for not changing employment terms). In any different case, the suspension is invalid and the employer is in default.
The sense of preserving the same number of employees does not include those voluntarily exiting service or retiring or employees under a fixed-term employment contract whose term expires.
Example: An enterprise included in the affected Activity Codes (ΚΑΔ), employs a total of 16 employees under employment contracts of indefinite term. Initially it decides to suspend 2 employment contracts on 01.04.2020 until 15.05.2020. Thereafter, it decides to suspend 1 more employment contract on 12.04.2020 until 27.05.2020. Finally, it decides to suspend 2 more employment contracts on 20.04.2020 until 04.06.2020. It must not terminate any agreement until 04.06.2020 (expiry date of the suspension of the last employment agreement) while it must preserve the same number of employees until 19.07.2020 (45 days after the end of the suspension).
6. Can employees whose employment relationship has been suspended offer their work?
Employees whose employment contract has been suspended cannot (and should not) offer their work. However, there are two exceptions:
(a) Only 10% of the suspended employees is permitted to be employed and only remotely (teleworking) exclusively for provisional needs of the enterprise.
(b) In all other cases of extraordinary, urgent, unable to be postponed and inelastic needs, the enterprises-employers may revoke employees whose contracts have been suspended.
In this case, the time the employees will be employed in order to cover this need will be calculated as working time and the employees must be remunerated in full by the enterprises-employers. This time also extents for an equal period the suspension of the employment contracts until 45 days are completed, i.e. the suspension period thereof.
7. What is in force for fixed-term employment contracts;
The fixed-term employment contracts may also be suspended and their term is extended respectively to the days of the suspension.
8. Do the employees or the employer receive financial support when the employment contract is suspended;
The financial support is distinguished in two types: one that concerns employees and one that concerns employers.
8.1. Employees whose employment contract is suspended are entitled to receive an extraordinary special allowance of €800 which corresponds to 45 of suspension.
8.2. The employers, regarding the employment contracts, which they suspended, will obtain the following financial support:
(a) They will not pay salary, employer’s contributions and social security fees for the employees, whose employment contract they suspended, for the period of 45 days and
(b) As regards the Easter Bonus, they may on one hand pay it until 30.06.2020, and on the other part of the Easter Bonus is paid by the employer, who corresponds to the actual days of work, while the part corresponding to the period of suspension is paid by the State’s budget.
For employees whose employment contract has not been suspended, the Easter Bonus is regularly paid on Holy Wednesday to its full extent.
(Β) TELEWORKING (HOME OFFICE)
1. Who is eligible for teleworking?
The employer is entitled to determine that the work offered by the employee in the place provided for by the employment contract, will be remotely performed (i.e. by means of teleworking) if possible, so that the employee will be able to continue working without his/her physical presence being required at the place of work.
2. Until when can someone work via teleworking?
The teleworking system may be applied until 30.04.2020, if it is not extended by Ministerial Decision.
3. Must the employee agree to teleworking?
The selection of this form of employment is a managerial right of the employer, which entitles the employer to unilaterally regulate all issues related to the organization and operation of its business for the achievement of its objects.
Although teleworking is a managerial right, for employees not included in the group of people showing symptoms or those with family members showing symptoms who according to the instructions of the Public Health National Organisation (EODY), must remain at home, the employer is obligated to accept the teleworking regime for these persons, always in the context of good faith and joint liability.
(C) SPECIAL PURPOSE LEAVE
1. Who are entitled to receive the special purpose leave?
Beneficiaries of the special purpose leave are:
(a) natural, step or god-parents of children, if their children: a) are enrolled in daycare, baby farm and nurseries, b) attend obligatory education institutions (kindergarten, elementary and junior high school), c) attend special schools or special training schools regardless of their age, d) are disabled persons benefited from structures where open care services are offered for disabled persons, regardless of their age.
(b) employees, who show symptoms or have family members showing symptoms who, according to the instructions of EODY must remain at home and
(c) employees included in high-risk groups, as these are particularised each time by the instructions of the EODY, whose health condition may be put at risk due to the COVID-19 pandemic.
2. How long does the special purpose leave apply and how is it calculated?
The use of the special purpose leave applies until 24.04.2020, provided that it is not extended with a new Ministerial Decision. It lasts for at least three (3) days, followed by one (1) day of regular leave, a scheme which is circularly repeated until the end of the extraordinary and provisional measure.
The leave is associated with the right to take the annual regular leave; consequently, with regard to the term of the service of the employees to the same employer, they may use it in full, provided that they meet the conditions set by the law for the taking of a regular annual leave of at least six (6) days for six-day working week or five (5) days for five-day working week. Otherwise they are entitled to make use of part thereof in proportion to their right for regular leave.
After three (3) days of special purpose leave, one (1) regular leave day is obligatorily added, which is subtracted by the total regular annual leave the employee is entitled to take for 2020.
In case the employee makes use of a shorter period, this will be calculated in full as regular leave.
3. Is the employee remunerated for the special annual leave?
The special purpose leave is considered to be employment time, is remunerated and insured as such and is taken into account for establishing any rights of the employees under the employment relationship.
The first two days of the special purpose leave are reimbursed by the employer while the third by the State.
4. Is the agreement of the employer required?
The special purpose leave is a right vested of the employee. He/she is entitled to request it and the employer is obligated to approve it, provided that the conditions for taking it are met.
(D) SAFE OPERATION STAFF
1. What enterprises can implement this employment scheme?
The specific employment scheme which resembles a particular rotational work may be implemented only by affected enterprises. The selection of such personnel working with reduced salary and for a shorter working schedule does not require any consultation with employees (in contrast to rotational work) and is unilaterally applied by the employer.
2. What are the conditions of this employment scheme?
An enterprise-employer who is affected may apply this employment scheme with in which:
(a) With a month being the reference period, every employee may work for a minimum of two (2) Weeks either consecutively or in parts,
(b) At least 50% of total staff of the enterprise are included in this organisational type
(c) The employer is obligated to maintain the same number of employees who were employed at the commencement of the scheme (i.e. not to terminate any employment contract and preserve the same employment conditions)
(d) For a period which cannot exceed six (6) months from 20.03.2020, i.e. until 20.09.2020.
3. Is the employer obligated to inform the employees?
From the provisions enacted so far, there is no obligation to inform in writing the employees employed under this organisational measure, given that no Ministerial Decision that particularises the details for the implementation of this scheme has been issued.
However for the sake of legal certainty, it is prudent that the enterprises-employers, after filing the respective Employer’s Solemn Declaration in the “ERGANI” IT System, should communicate in writing or by email on the same day to their employees, stating as well the filing protocol number (proportional application of the respective provision for suspension of employment contracts).
4. What about the employees’ wages?
The wages of employees are paid reduced by the respective employment time, with the reference period being one month, and in any case not less than 50%.
(Ε) INTRA-COMPANY TRANSFER
1. What do the relevant provisions provide for?
In the context of the extraordinary and provisional measures in employment for dealing with and limiting the dissemination of the coronavirus, the employer whose business activity is essentially affected or has been suspended based on the applicable regulatory acts, may transfer personnel from an enterprise of the group to another enterprise of the same group, following a relevant mutual agreement.
Group enterprises who will implement the above measure are obligated to preserve in total, the same number of employees employed before the transfer.
OTHER FINANCIAL MEASURES
1. What enterprises are entitled to suspend the payment of insurance contributions and VAT?
This benefiting measure includes the enterprises employing personnel remunerated with monthly or daily wages, under a private law regime, for fixed or indefinite term, on a full-time or part-time or rotational scheme, with an active, main activity code on 20.03.2020. Payment – without interest and surcharges – of debts for VAT, debts towards Tax Offices and instalments of settlements for previous debts to the Tax Offices or Audit Centers as well as the payment of debts under settlements with Insurance Funds are suspended for three months, i.e. until 31.07.2020. Full insurance coverage is granted by the State for employees, calculated on their nominal wages for a period of 45 days. Contributions suspended are the insured’s and employer’s contributions (where provided), for all insurance sectors (main insurance, healthcare insurance, auxiliary insurance, one-off benefits) and of any other agency for which e-ΕΦΚΑ collects contributions, with the exception of the contributions under optional insurance. Enterprises will file an Analytical Periodical Return (Α.Π.Δ.) for their employees which the Α.Π.Δ. for February and March 2020 are filed within the deadlines provided for by the law.
2. Can the enterprise unilaterally place the employee under an unpaid-leave regime?
The unpaid leave cannot unilaterally be established, with the exception of a request filed by the employee and the final approval by the enterprise. Unpaid leaves which have been agreed upon between employees and enterprises which have suspended their business activity by order of a public authority, are ipso facto cancelled from 28.03.2020 (date of publication of the Ministerial Decision (ΥΑ( (12998/232 Φ.Ε.Κ. 1078 Β). The employment contracts of these employees are suspended and they are entitled to receive the special purpose severance.
Note: It is pointed out that the above outline of provisions is suggestive and summarizing and aims at providing a quick update in relation to the legal framework. Any subjection of your company to the above provisions and the conditions of this subjection constitute the object of a more complete analysis for which the provision of specialized legal advice is required.
D I S C L A I M E R