Government approves COVID-19 wage support scheme for March and April

A cabinet meeting in progress at the Stenbock House.
A cabinet meeting in progress at the Stenbock House. Source: Stenbocki maja Flickr

The government approved an extension of the a wage support scheme issued in response to the coronavirus pandemic to cover both March and April. The scheme originally in place would have run for only one month.

The change followed calls from the Unemployment Insurance Fund (Töötukassa) – the body that will issue the actual wage support – to do just that, based largely on the fact that the fund still had close to €38 million in its coffers left over from a similar scheme initiated last spring, in addition to the €102.2 million earmarked for wage support in the supplementary budget which passed a Riigikogu vote this week.

Minister of Health and Labor Tanel Kiik said that: "Due to the COVID-19 crisis, the daily economic activities of many employers have been disrupted, revenue and income have fallen sharply, and it has become more difficult to secure employment and pay employees."

"In order to maintain people's social security and jobs, the government supported the expansion of salary compensation," Kiik added, according to BNS.

The provisions of the regulation are substantively the same as those proposed by the Unemployment Insurance Fund, which are as follows:

  • Employers whose reported turnover in the month in which the benefit is claimed fallen by at least 50 percent either over the period December 2019 to February 2020, or compared with the second half of 2020, as a direct result of the pandemic, are eligible.
  • Up to 60 percent of the average month's wage, up to €1,000 gross, whichever is lower, will be payable, for those staff who are either under-employed or have or are seeing wage cuts.
  • Employer must pay a minimum of €200 per month gross towards an employee's wage to qualify for the aid, and ahead of applying.
  • Self-employed entrepreneurs whose revenue fell by 50 percent on year to 2020 as a result of the pandemic are also eligible. Support for the self-employed amounts to €584 per month.
  • No bankruptcy or liquidation proceeds can be pending against the applicant business, nor can an applicant business owe back taxes.
  • ,Employees must have started work for the company no later than January 1 2021. The staff member may not be dismissed over that month in which the support is received, or the following two months.
  • Applications for the March wage support would be open through April, with the same process following in May, to cover April's support.

The regulation will enter into force in accordance with general procedure, BNS reports.

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Editor: Andrew Whyte

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