New measures from Croatian government for employment preservation COVID-19

Last change / actual info valid from 06.04.2020.

Croatian Employment Service
Objective of support
Keeping jobs with employers who have been disrupted by economic activity due to a special circumstance caused by the Coronavirus (COVID-19).
About support
This aid does not have the characteristics of low-value state aid, as it is an integral part of the Government’s economic measures which include preserving jobs in the most vulnerable sectors.
It is aimed at employers engaged in economic activity.

Duration of the support

3 months starting from 01.03.202

The amount of the subsidy

For March 2020:

A.) An amount of HRK 3,250.00 per month for a full-time worker, or a proportionate portion per worker for the number of part-time hours for the Companies who can prove Corona virus affected their income for more than 20%.
B) Proportional part of the amount of HRK 3,250.00 per employee for the time they did not work according to the Decision of the Civil Protection Staff (the subsidy for 3 months is proportional to the number of days from which the company cannot practice)
D.) The amount of HRK 4,000.00 for the month of April and May per full-time worker, that is, the proportional part per worker according to the number of part-time work hours.
On the basis of data from the Tax Administration, the Croatian Employment Service will make payment of contributions (MIO II) in proportion to the amount of the grant awarded:
-amount of HRK 203.12 for the March / per employee

-amount of HRK 250.00 for the April and May/ per month/ per employee

Target groups of employees 
For Companies having more than 10 employees: not eligible for the Company owners, co-owners, founders, board members, directors, procurators, etc. (does not apply to employers employing up to 10 workers) 
– If more than one business entity has the same founder / owner who individually employs less than 10 workers, and in the total number of employees there are more than 10 employees, they are not subject to the exemption, ie the support for owners, co-owners, founders, members of the management board is not granted, directors and procurators.
– Support is not granted to co-owners with more than 25% stake in a company or other legal entity.
– The target group of  employees includes all insured persons with the employer in question (whether they work for a fixed or indefinite period, citizenship, working hours and status), except pensioners and foreign workers from third countries who have their residence and work permit expired.
– The target group of employees  includes employees employed in the branches of representative offices of foreign companies in the Republic of Croatia.
– Employers with active self-employment support contracts can use this measure for themselves and other employees.

Conditions under which employers can request support

All employers requesting support should prove the impact of the special circumstances:
– turnover decrease
– cancellation of reservations, events, congresses, seminars, etc.
– cancellation of business contracts and orders
– inability to deliver finished products or contracted and paid raw materials, raw materials, machinery, tools, etc.

– inability to re-order raw materials, raw materials, tools and machines necessary for work
If the Employer performs several activities and cannot perform some of them due to the Decision of the Civil Protection Headquarters, and in the rest of the activity has a decline in business activities or some other justified reasons and wants to obtain support for all, he must submit separate requests for reasons of justification.

 

Which Companies are qualified for using this measure?
– All employers who have registered the activity and made application to the HZMO  system by 02/29/2020. can use the measure (meaning if the Company have employees employed before this date, they are qualified for using this salary support measure).
– Companies in liquidation or bankruptcy can use this measure if they have employees and meet their obligations

Which Companies are not qualified and  can’t use the measure?
– Employers who have not paid salaries  for February 2020 cannot use the measure.
– For workers employed after 19 March 2020 whatever the reason for hiring, support cannot be granted except when it comes to hiring a substitute for workers for whom the Support was used and the employment contracts were not canceled by the fault of the employer.
– Employers who cannot carry out the activity by a decision of the Civil Protection Headquarters, and the inspection has established a violation of the ban, cannot use the support.
– Employers found to be in breach of the Decision of the Government of the Republic of Croatia on exceptional price control measures for certain products cannot be used for support.

Deadlines for submitting support request:

Payments for March, April and May 2020 will be approved for applications for aid received as of April 7, 2020.
Support applications received between April 8 and May 7, 2020 will be eligible for payment of salary costs for April and May 2020.
Support applications received between May 8 and June 7, 2020 will be eligible for payment of salary for May 2020.

Support and employment

Employers who experienced a decline in staff from March 1 to March 20, 2020 may be granted support.
The employer loses the right to support if from March 20, 2020. by the time the aid was paid, there was a decrease in employment greater than:
40% for employers employing up to 10 workers

20% small businesses from 10 to 20 employees
15% medium-sized enterprises

10% large enterprises
The same does not include the expiry of a fixed-term employment contract, the retirement of workers and the dismissal of concealed employee behavior.

How to apply for support

Nautical consulting already applied on behalf of qualified clients, and informed all clients entitled for support as soon first pack of Measures announced from Croatian government were defined. There are several steps including application form, written explanation of loss of income, income 2019/2020 comparison, booking cancellations. Although this requires additional time and knowledge, our clients are not charged additionally for support and collecting/filling documentation, because we would like to show our solidarity in this difficult times for everyone.

 

 

 

 

 

 

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