23rd October 2020, Skopje – On Friday, the Government adopted the Draft Law on Financial Support, proposed by the Ministry of Finance, aimed at supporting employers affected by COVID-19 crisis for payment of wages for October, November and December 2020. The draft Law is to be submitted for adoption to the Parliament. Employers may apply for financial support up to Denar 21,776 per employee to the 7th in the current month for the previous month, while the companies experiencing at least 30% decline in revenues in the respective period from April to October 2020, compared to the same month last year, can be beneficiaries of this measure.
The measure is aimed at supporting the jobs, the employees’ wages, around EUR 70 million being injected in the economy providing liquidity support to the companies as well. The previous measure yielded results – more than EUR 83 million were injected in the economy, more than 120,000 jobs, as well as the standard, were protected, considering that average wage as of August inclusive was higher by 8.2% on annual basis, despite the Coronavirus crisis.
Under the new draft Law, the measure is even more targeted, i.e. the companies being severely hit by the crisis are envisaged to be paid higher financial support. In fact, companies experiencing from 30% to 40% decline in revenues will be granted up to Denar 14,500 per employee; those experiencing from 40.1% to 50% decline in revenues will be granted up to Denar 15,955 per employee; up to Denar 17,410 per employee is envisaged for revenue decline from 50.01% to 60%; up to Denar 18,865 per employee is envisaged for revenue decline from 60.01% to 70%; up to Denar 20,320 per employee is envisaged for revenue decline from 70.01% to 80%; while companies experiencing more than 80% decline in revenues will be granted up to Denar 21,776 per employee. As regards the better targeting, the draft Law does not cover companies having generated profit higher than EUR 10 million cumulatively in the last three years.
Financial result of the companies in the period from April to October, November and December 2020 is taken as a reference period, and is compared to the same period last year. In case a company is registered after September 2019, the date of its registration in the Central Registry is taken into account.
Companies applying for this measure may not pay dividends and performance bonuses or any other kind of annual rewards up to the date of payment of the wage for December 2020.
As regards the employees, the companies applying for financial support may not have more than 10% of its employees receiving net wage higher than Denar 120,000. Companies may not apply for financial support for wage per employee who has received net wage higher than Denar 39,000 in June, July, August and September, for each month separately on full time or part-time basis. In addition, employees using the “Macedonia Employs” measure, as well as employees engaged under supplementary work contract, may not apply for this measure.
Employers using the financial support measure are not allowed to reduce the number of employees two months following the month for which financial support is used, by February 2021 inclusive, except in case of retirement, termination of the employment contract by the employee, mutually agreed takeover of the employee, termination of the employment contract without notice by the employer due to violation of the working order and discipline or the working tasks and duties, and similar.
The draft Law envisages protective mechanisms in terms of the employee receiving the wage in full. In fact, in case the employer pays lower wage to the employee than the amount granted, fines of up to EUR 10,000 are envisaged, depending on the size of the legal entity.
