The number of people suffering from the coronavirus has been decreasing lately. As a result, some implemented short-time work measures – that affect labor law related topics – have been lifted by the government.

In order to simplify the application process, new pre-application and request forms have been designed. There was no longer a deadline to consider for the pre-application and the waiting period during which the employer must bear the work loss by itself has also been abolished.

Short-time work – What was valid until now?

Further, overtime accumulated during past months did not have to be specified anymore when requesting the compensation. Thus, overtime did not have to be reduced in advance anymore in order to benefit from the short-time work compensation.

Since employees who are not in a permanent employment relationship were also severely affected by the slump in economy, the Federal Council has expanded the eligibility for short-time work compensation to the following people:

  • Employees with a fixed-term employment contract
  • Temporary workers
  • Apprentices
  • Spouses who work in the company
  • Shareholders, partners and other financially involved people as well as people that are directly involved in the decision-making process of the company

Further measures such as the possibility of a deferral of certain social security contributions (AHV/IV/EO and ALV) have additionally been implemented.

Short-time work – What is new?

  • As of June, the extraordinary entitlement to short-time work compensation for shareholders, partners and other financially interested persons or people directly involved in the decision-making process is no longer available.
  • As of June, the extraordinary entitlement to short-time work compensation for apprentices no longer exists, either.
  • As of June, the pre-application deadline (that had been abolished) has been reinstated. Companies whose pre-application has already been approved, however, do not have to submit a new pre-application as of June 1, 2020. They can (for now) rely on the decision already received by the competent cantonal authority.

Loss of Earnings – What was valid until now?

  • Compensation was available if an employee or a self-employed individual had to take care of own children up to the age of 12 as a result of school closings and the absence of external childcare and therefore suffered from a loss of earnings. The right to compensation has been expanded to employees and self-employed individuals with minors that are eligible to an intensive care supplement due to disabilities according to the IVG and to employees and self-employed individuals with children up to the age of 20 provided they attend a special-needs school.
  • Compensation was also available if an employee or a self-employed individual had to stay in quarantine and therefore suffered a loss of earnings or if a self-employed individual directly or indirectly suffered a loss of earnings as a result of a measure such as the closure of certain publicly accessible facilities, shops and restaurants for example.

Loss of Earnings – What is new?

  • According to the decisions of the Federal Council to gradually relax the measures implemented during the past few months, primary schools conduct classroom teaching again since May 11, 2020. Therefore, the entitlement to compensation for the loss of earnings as a result of childcare duties for both employees and self-employed individuals, in principle, ended on this date as well. The entitlement to the respective compensation may, however, continue to exist under certain circumstances.
  • The compensation for the loss of earnings as a result of the closure of certain publicly accessible facilities, shops and restaurants or other measures had to be paid until May 16, 2020, if the (directly or indirectly) affected self-employed individuals were able to reopen (under restrictions) their business as from April 27, 2020 or May 11, 2020.

What to expect?

  • The Federal Council’s simplifying measures regarding short-time work that are still valid will be abolished as of August 31, 2020. Subsequently, the existing law applies in principle and in particular the Unemployment Insurance Act will be relevant again.
  • Since it can still not be excluded whether a second wave of the virus will occur and, if so, what measures will be taken (again), there is still uncertainty concerning the “return to normal” as of September 1, 2020.
  • The State Secretariat for Economic Affairs (SECO), the Federal Office for Public Health (FOPH) as well as the Federal Council constantly monitor the development of the virus and the economy. Updates and announcements regarding short-time work and further financial support measures are expected.

EY is your partner for this challenge

We discuss with you in a personal meeting or remotely:

  • how to deal with the consequences of COVID-19 in your everyday work,
  • how we can support you in the coordination of the various measures and financial support options or how we can manage these processes for you.

Feel free to contact us at any time!

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