Economic downtime or reduced working time
Salary subsidies for employees affected by economic downtime or reduced working time.
Kochański & Partners, on behalf of its Clients, have already successfully submitted the first applications for salary subsidies under the so-called “Anti-Crisis Shield”. The basic assumptions of this scheme and its benefits for Businesses are presented below.
Conditions for obtaining funding
A subsidy is received through the Provincial Employment Offices (Wojewódzki Urząd Pracy). The necessary eligibility condition is a decrease in the company’s sales in the amount of:
a.no less than 15%, calculated as the ratio of the total sales in any two consecutive calendar months in the period from 1 January 2020 to the date immediately preceding the date of application, to the total sales in the corresponding two consecutive calendar months of the previous year (with 30 consecutive calendar days also being treated as one month), OR
b.no less than 25%, calculated as the ratio of the sales of any given calendar month from 1 January 2020 to the date immediately preceding the date of the application, to the sales of the previous month (with 30 consecutive calendar days also being treated as one month).
The subsidy is payable in respect of salaries under:
- contracts of employment,
- outwork contracts,
- service contracts,
- any other agreements for provision of services.
The subsidy is not payable on an employee remuneration which is higher than 300% of the average monthly remuneration from the previous quarter, i.e. currently approx. PLN 15,600.
What are the funding opportunities
There are two possible solutions for the employer:
Example of a simulation
1.An employer has reduced an employee’s working time and his salary by 20% and instead of PLN 5,000, the employee will now earn PLN 4,000. For the company, the total cost of employment of this employee (including social security contributions) before the change was PLN 6,000, while after the change it will be approx. PLN 4,800. The employer can obtain a subsidy of PLN 2,000 to such reduced salary plus the equivalent of social security contributions that he should pay (approx. PLN 400). Therefore, for this employee, the employer will receive a total subsidy of approx. PLN 2,400, and the employer himself will also pay approx. PLN 2,400 (the total cost, as mentioned above, is PLN 4,800). This means that in this case the total cost of employment for the company will be reduced by about 60% – from PLN 6,000 to PLN 2,400 per month.
In the case of an employer employing 50 people with a net monthly salary of PLN 5,000, the total financing for the period of 3 months may amount to as much as approx. PLN 360,000.
Contact the Kochański & Partners team now, for more details of our Anti-Crisis Shield assistance.
Attorney at Law, Partner, Head of Labor Law Practice
T: +48 660 765 903
Advocate, Partner, Head of Commercial Law Practice
T: +48 881 048 481