Coronavirus and Employment Relationships (: Suspension of employment contracts for the month of December)
The legislative delays (of course also the delays at taking measures at the department of national health) were unjustified during the critical, second, wave of the Pandemic. We have mentioned them in our previous article. We also referred to the phenomenon of ex-post legislation that creates so many problems in business planning and in the persons involved (businesses, employees, accountants). The phenomenon exceeded all logic when on 26.11.20 the legal framework for the suspension of employment contracts for the month of November was published (although it had been announced from 31.10.20, by the Prime Minister). Ministerial Order no. 49989/20 has already been published (Government Gazette B’ 5391/7.12.20) regarding the suspension of employment contracts for the month of December. It is a small progress time-wise.
But let’s look at its basic provisions.
A. Businesses whose operation is suspended by order of a public authority.
Question 1: Which businesses do the measures concern?
The measures concern the businesses which have their headquarters or a branch-branches in regional units, whose operation of the headquarters or their branches is suspended, by order of a public authority, depending on the NACE Revision 2 classification of their business activity, as defined by the Ministry of Finance (Chapter A, Article 1 §1).
Question 2: Which employees’ contracts are suspended and for how long?
The measure concerns the employees of the above (Question 1) businesses, who have been hired until November 4, 2020. Their contracts are obligatorily suspended (or their pre-existing suspension is extended) for the period, as the case may be, from 1.11. 2020 until 6.11.2020 or 7.11.2020 until 30.11.2020 (chapter A, articles 1 §§1 & 2). The same applies to employees who have joined the COOPERATION Program (chapter A, articles 1 §§1 & 2). Also, to those employees who are subsidized by the Open Program of the 100,000 new subsidized jobs (Chapter A, Article 1 §3b).
Question 3: What about fixed-term employment contracts?
Fixed-term employment contracts which expire after the date of suspension of the operation of their employer’s business by order of a public authority, must be suspended. After the period of suspension, the employment contracts are continued for the agreed, remaining time. This obligation does not apply when there is an objective weakness such as, for example, in the cases of businesses that by their form or type or activity have a specific operating time (Chapter A, Article 1 §3a).
Question 4: What about the exceptional activities of these businesses?
The specific businesses, those that exemptions from the suspension for specific activities of theirs apply, can:
(a) Have their employees (whose employment contracts have not been suspended) telework, where it possible (Chapter A, Article 1 §4a),
(b) Hire employees under the program “Open Program for 100,000 new subsidized jobs”. The specific employees can telework, but it is not possible to suspend their contracts (Chapter A, Article 1 §4b) and
(c) Suspend the employment contracts of their employees (Chapter A, Article 1 §4c).
Question 5: Is it possible to revoke the suspension of employment contracts of employees of the specific businesses?
These businesses may only temporarily revoke the suspension of their employees’ employment contracts to cover emergency, temporary, urgent and inelastic needs, in the context of the COVID-19 coronavirus (Chapter A, Article 1 §5).
Question 6: What are the obligations of the specific businesses?
These businesses for as long as the contracts of their employees are suspended and, in any case, until December 31, 2020, are obliged not to reduce their staff due to dismissals. In case of a dismissal, such is invalid (Chapter A, Article 1 §6).
B. Affected businesses
Question 7: Which businesses do the measures concern?
The measures concern the businesses that have been determined by the Ministry of Finance as affected, depending on the NACE Revision 2 classification of their business activity (chapter B, article 1 §1).
Question 8: Which employees’ contracts can be suspended and for how long?
The measure concerns the employees of the above (Question 7) businesses. Their contracts may be suspended (or their pre-existing suspension can be extended) from 1.12.2020 to 31.12.2020 at the latest (Chapter B, Articles 1 §1a & b). The same applies to employees who have joined the COOPERATION Program (Chapter B, Article 1 §4). Also, to those employees who are subsidized by the Open Program for the 100,000 new subsidized jobs, under the condition that all employees of the business are suspended (Chapter B, Article 1 §3).
Question 9: What about fixed-term employment contracts?
The suspension of fixed-term employment contracts of employees, which had been suspended in the past, can be extended until 30.11.20-maximum. It is possible to suspend, for the first time, fixed-term employment contracts of employees who were hired before 4.11.20. After the expiration of the period of suspension, the employment contracts continue for the agreed, remaining, time. This obligation does not apply when there is an objective weakness such as, for example, in the cases of businesses that by their form or type or activity have a specific operating time (Chapter B, Article 2 §3).
Question 10: Is it possible to revoke the suspension of employment contracts of employees of the specific businesses? The utilization of the “COOPERATION” program?
The specific businesses may revoke the suspension of employment contracts of their employees but also re-suspend them until 31.12.20 (Chapter B, Article 2 §4). Contrary to the provisions for the revocation of the suspension by businesses whose operation has been suspended by order of a public authority, the affected businesses are not required to give any special reason to revoke the suspension of employment contracts. It is also possible (chapter B, article 2 §5a) to utilize the COOPERATION program for their employees whose employment contracts are not suspended.
Question 11: What about telework?
These businesses are obliged to have their employees telework, as long as their work can by provided this way, according to what is defined by the no. 44921/1377 / 2.11.20 CMO (chapter B, article 2 § 5b).
Question 12: What are the obligations of the specific businesses?
These businesses are obliged not to reduce the number of their staff by dismissals for as long as their employees’ contracts are suspended, and in any case, until December 31, 2020. In case of a dismissal, such is invalid (Chapter B, Article 2 §1).
They are also required to maintain the same number of jobs and with the same type of employment contracts, for a period equal to the total period of the suspension of their employees’ employment contracts. This obligation does not exist when there is an objective impossibility of fulfilling it, as in cases of businesses that by their form, type or activity have a specific operating time. The businesses are not obliged to replace those who have quit, retirees, the deceased and those employees whose employment contract expires during the above period (Chapter B, Article 2 §2).
C. Special purpose remuneration
Question 13: What is the amount of the special purpose remuneration? Who are its beneficiaries?
Employees whose employment contracts are suspended are entitled to special purpose remuneration in proportion to the duration of the suspension of their employment contracts, based on the calculation of the amount of five hundred and thirty-four euros (€ 534.00) corresponding to thirty (30) days (Chapter C, article 1 §1). This remuneration burdens solely the state budget (Chapter C, article 1 §1).
Question 14: Are there any burdens on the special purpose remuneration? Can it be confiscated?
The special purpose remuneration is tax-free, inalienable and cannot be confiscated by the State or by third parties, it is not subject to any deductions, fees or contributions, it cannot be trapped nor can it be set off with certified debts to the tax authority and the State in general, municipalities, regional units, insurance funds or credit institutions (Chapter C, article 1 §2).
The above mentioned CMO regulates issues within the first ten days of December that should have been provided for and regulated before the beginning of the month. It is, however, a small improvement (according to what is mentioned in the introduction) in relation to the negative experiences we have become accustomed to in the context of the second wave of the Pandemic.
Let us hope that the management of the health crisis will become faster and more agile.
Stavros Koumentakis
Managing Partner
P.S. A brief version of this article has been published in MAKEDONIA Newspaper and makthes.gr (December 10, 2020).
Disclaimer: the information provided in this article is not (and is not intended to) constitute legal advice. Legal advice can only be offered by a competent attorney and after the latter takes into consideration all the relevant to your case data that you will provide them with. See here for more details.