EMCC European Monitoring Centre on Change

Annual working time account and short-time working to retain employees at temporary reduced workload

Slovakia
Phase: Management
Veids:
  • Response to COVID-19
  • Income support for workers
  • Working time flexibility
Pēdējoreiz mainīts: 03 August, 2021
Nosaukums lokālajā valodā:

Konto pracovného času a podpora udržania zamestnancov pri dočasnom nedostatku práce

Nosaukums angliski:

Annual working time account and short-time working to retain employees at temporary reduced workload

Coverage/Eligibility

Measure in place in cases of serious operational reasons that prevent employers from assigning full workload to an employee.

Main characteristics

In cases where an employer outlines, in a written agreement with employee representatives, serious operational reasons that prevent them from assigning work to an employee, that employee is entitled to wage compensation. The amount of this compensation is stipulated in the agreement and must be, at minimum, 60% of the employee's average earnings. On request of the employer, the public employment service UPSVaR can provide an allowance equivalent to 50% of the paid compensation amount for a maximum of 12 months.

Another option allowing flexibility in case of substantive operational reasons that prevent the employer from assigning work to an employee is the implementation of a working time account. This must be agreed in writing with employee representatives (also in the collective agreement) and cannot exceed 30 months. An employer is obliged to pay the basic wage corresponding to the employee's agreed weekly working time. The employee is obliged to work extra hours owed to the employer without undue delay, when the employer is in a position to provide them with work again. 

Based on a collective agreement or an agreement with employee representatives, an employer may assign unregular workload across weeks over a period of 4 -12 months. Working time may not exceed 12 hours within 24 hours. An employee may be requested to work overtime for up to 150 hours per calendar year.

In relation to the COVID-19 pandemic, new short-time working schemes have been made available via First Aid, Measures 1-3. Since April 2020, employers and self-employed, whose firms suffered compulsory closures by decision of the Public Health Authority can apply for financial support with the public employment service UPSVaR corresponding up to 80% of the average wages of their employees.  Employers and self-employed, who were not compulsory closed but experienced a drop in demand due to the COVID-19 pandemic, have two options: apply for 80% wage compensation or for fixed allowance depending on the percentage of drop in demand (at least 20%). Usual contributions to insurance funds are still being paid by the firms. Maintenance of jobs and wage replacement is co-financed from the ESF.  

Funding

  • National funds
  • European funds
  • European Funds (ESF)
  • Employer

Involved actors

National government
Legal framework.
Public employment services
Provides the allowance in agreement with the employer. Regarding the new COVID-19 instruments, UPSVaR manages employers' applications for wage compensations or allowances.
Employer or employee organisations
Agreement with employee representatives, usually trade unions.

Effectiveness

This measure has often been implemented during the economic crisis in 2009-2010. It is estimated that several companies implemented it, impacting on about 40,000 workers.

According to a survey of 5,063 companies with 819,000 employees by ISPP in 2013, agreements on implementation of working time account were concluded in 4.8% of companies and agreements of short-time working in 8.3% of the surveyed companies. According to agreements concluded by OZ Kovo (Metal union), which covers mainly mechanical engineering, automotive and electric sectors, short-time working was agreed in 24.5% of surveyed companies and a working time account in 15.9% of companies in the sample. The Information System on Working Conditions (ISPP 2017), which covers 899,129 employees, shows that the use of these instruments is quite stable. For instance, short-time working was implemented in 7.7% of surveyed companies in the business sector and working time account was agreed in 4.7% of companies. The Metal union concluded agreements on their implementation in 25.2% and 16.3% respectively, of surveyed companies. 

Via First Aid, Measures1-3, the highes value of support, almost €174 million, was paid by the UPSVaR to employers and self-employed for wage compensation in April 2020, that saved almost 452,000 jobs. In June, it was only about €57 million, to support about 186,000 jobs.

Strengths

The implementation of both instruments is regulated by law. They allow employees to retain their jobs during a temporary downturn in business. Redundant employees receive some income during this period.  

In April 2020, First Aid, Measures 1-3 assisted almost 81,000 employers and self-employed to keep their jobs. In June, this support was provided to less than 36,000 entrepreuers.

Weaknesses

Initially, the working time account was called 'Flexikonto' and its application was limited to the end of 2012. In the case of short-time working in 2009-2010, state subsidies to compulsory insurance funds paid by employers applied short-time working were limited to 60 calendar days in the year. Employees working short-time received reduced wages.  

Some, mainly large employers, criticised that the financial support to compensate employees' wages did not sufficiently cover missing financial resources caused by the COVID-19 pandemic.

Piemēri

Volkswagen Slovakia, US Steel Kosice, KIA Motors Zilina.
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