1. What measures can be implemented by employers in relation to employees who have returned from the territories affected by the virus?
Save for limited exceptions that apply to diplomats, health care employees and a few other categories, persons who have entered in Estonia on March 17, 2020 or later are required to stay in their place of residence for 14 days after crossing the Estonian border under the order of the Government of the Republic. Consequently, employees returning from their travels in other countries are automatically required to self-isolate and are, under the Employment Contract Act, required to inform the employer of their absence and its duration. If it is not possible for such employees to work from home, the respective isolation period is not required to be remunerated.
Persons that have returned from abroad have a duty to self-isolate for 14 days and not to go to work. Accordingly, employers are entitled to deny entry into the workplace for such employees who have returned from abroad and have not complied with the said duties. In case it is not possible to ensure remote work for such employees, employer can temporarily suspend the employees without pay.
Persons who have entered to Lithuania from abroad have to register with the National Public Health Centre by filling in special form and are required to self-isolate for 14 days thereafter under the order of the Cabinet of the Ministers. Consequently, such employees are additionally required to inform the employer of their absence and its duration. If possible, the employers are obligated to order the employees to work remotely. If the persons breach isolation regime they can be punished, and the employers can suspend them from work without remuneration.
Belarus has not announced emergency situation or national quarantine regime. On March 25, 2020 the Council of Ministers of the Republic of Belarus adopted the regulation according to which people arriving at Belarus from the countries where cases of COVID-19 infection are registered, must be self-isolated for 14 calendar days from the date of arrival. No additional obligation or rights were provided to employers with this regard. Although these issues shall be resolved locally in each company individually, the new regulation may provide for following opportunities for the employers: 1) suspension from work (to be confirmed with Department of labor), 2) absence from work for good reason with no salary for the relevant period. Such measures as remote work, paid or unpaid social or work leave can be taken upon consent of the employee.
2. Is it possible to temporarily reduce the number of employees or impose part time work?
An employer may extraordinarily terminate an employment contract if the continuance of the employment relationship on the agreed conditions becomes impossible due to a decrease in the work volume or reorganisation of work or other cessation of work. The redundancy would be of permanent nature, but employers are, of course, free to re-hire the employees when the situation improves.
As an alternative, employers may reduce the pay of the employees unilaterally for up to three months over a period of 12 months to a reasonable extent, but not below the minimum wage (currently EUR 584), if payment of the agreed wages would be unreasonably burdensome for the employer due to unforeseen economic circumstances beyond its control. Employees may reduce the working hours in proportion to the pay cut.
The same as in other situations, employers are entitled to perform redundancies also as a result of consequences of the virus. Whether the redundancy is temporary or permanent, is completely at the employer’s discretion. Upon implementing the redundancy, employer is not obliged to ensure re-hiring of the employees after certain time – it is the employer’s choice. Switching to part-time work by reducing the employee’s salary is possible only by agreement of the parties since such changes entail amendments to the employment contract that are possible only subject to mutual agreement. Since redundancy is a lengthy and costly procedure, the best solution would be to enter in some kind of agreement with the employees.
An employer may terminate an employment contract if the continuance of the employment relationship becomes impossible due to changes in organisation of work or other cessation of work. Whether the redundancy is temporary or permanent, is completely at the employer’s choice. The employer is not obligated to ensure re-hiring of the employees after certain time. Switching to part-time work by reducing the employee’s salary is possible only by mutual agreement between the parties since such changes entail amendments to the employment contract. However, the termination of the agreements is not recommended due to the approach of the Cabinet of the Ministers encouraging keeping all employees employed. The best recommendable solution in the given situation would be the declaration of the idle time (down time). It may be applied only if remote work is impossible and an employee refuses to work in another job position. The employer shall pay at least minimum wage/salary (EUR 607 monthly gross). 70% or 90% of the employer’s costs will be covered by the State as the subsidy.
Redundancies can take place only due to relevant organizational, economic or financial reasons – which can be triggered by COVID-19 pandemic – with 2-month notification of employees and compensation equal to 3 average monthly salaries. Redundancy means employment termination, but both parties can agree on new employment once the situation becomes stable again. Part-time work or salary reduction can be unilaterally imposed by employers only through changing the essential working conditions, which shall be duly grounded. If an employee does not agree on new working conditions during 1-month notice period, the employment can be terminated. Upon mutual agreement of the parties any changes can be implemented.
3. What are the duties of employers in relation to work safety?
Employers are required to ensure a safe working environment to the employees and are consequently required to suspend employees with symptoms of the virus. Sending of employees to business trips is to be avoided. Where it’s possible, an employer may ask employees to work from home. An employer may also decide to close the workplace as a preventive measure. In this case an employer must continue to pay employees and grant other rights and benefits to them under their employment contracts and legislation.
In line with the order of the Cabinet of Ministers regarding announcement of emergency situation, employers have the following duties:
- to cancel or postpone business trips abroad;
- to ensure that persons with acute symptoms of respiratory infections are not admitted to work in positions related to potential health risks for other persons.
Taking into account the employer’s duty to ensure safe and healthy working conditions for employees, it is advisable to consider the following additional measures depending on the business specifics of the company:
- provide recommendations for employees regarding compliance with personal hygiene and prevention measures in line with the guidelines published on the website of SPKC;
- introduce remote work to the extent possible;
- implement increased disinfection measures.
If the employer suspects symptoms of Covid-19 or other symptoms, employer can send the employee for a health check.
The employers have to ensure health and safety at work. Taking into account decisions of the Cabinet of the Ministers, the employers are obliged to organize working of the employees from home (remotely). In exceptional cases the employees can work from the office. If the employees refuse to work remotely the employer can suspend those employees from work without remuneration. The employers must ensure the efficient disinfection in the premises of the company according to the recommendations of National public health centre. All meetings if arranged must ensure that the distance between the participants would not be les that 2.5 meters. The employers must ensure that the employees would comply with the personal hygiene. If symptoms of COVID 19 appear, the employers must order such person to immediately leave the premises and report to the health institution.
There are no specific COVID-19 related duties of employers in relation to work safety. Taking into account the general duty to ensure safe and healthy working conditions for employees, it is advisable to consider the following additional measures:
- provide recommendations for employees regarding compliance with personal hygiene and preventive measures in line with the guidelines of the Ministry of Health;
- introduce remote work, if possible;
- implement increased disinfection measures.
4. Are there any support measures for employers introduced by the government?
Compensation of salary
On March 19, 2020 the Estonian government approved the relief measures for the employees subject to salary cut due to decrease of work.
The relief measure will be made available to the companies that meet two out of the following three criteria:
- The sales or income of the company has decreased by at least 30 percent in comparison to the same period last year.
- The company cannot provide work to at least 30 percent of its employees due to the coronavirus.
- The company has reduced the wages of its employees by at least 30 percent.
The Estonian Unemployment Insurance Fund will compensate 70% of the average gross wages of the employees (calculated on the basis of the last 12 months), but not more than EUR 1,000 per month. Employers shall have the obligation, while receiving the aid, to pay at least EUR 150 per month to their every employee. The taxes shall be paid by the Estonian Unemployment Insurance Fund and by the employers themselves.
Employers can use the measure during two months between March 1, 2020 and May 31, 2020. Applications for the relief measures will likely be accepted from April.
According to the information available, the Estonian Unemployment Insurance Fund allocates 250 million euros from its reserves for the above mitigation measures.
Temporary measures relating to foreign employees
Foreigners who had statutory grounds to reside in Estonia on March 12, 2020 and are facing obstacles in leaving the country are deemed to have a statutory ground to remain in Estonia also after the expiry of their visa or residence permit. They are not required to file for a prolongation of their visa or residence permit. Processing of new visa, residence permit and short-term employment applications has been suspended for the time being.
If an employee is on sick leave due to Covid-19 infection during the period from 22 March until 30 June, support will be granted in the form of payment of the employer’s part of sick leave, i.e., days 2-10 of the sick leave.
On 26 March 2020 the Cabinet of Ministers has adopted a decision that any employers will be entitled to receive the idle time compensations if the following criteria are met:
- If the income from commercial activity during March or April 2020 has decreased by at least 30% in comparison to the same month of 2019 due to the spread of Covid-19; or
- If the income from commercial activity during March or April 2020 has decreased by at least 20% in comparison to the same month of 2019 due to the spread of Covid-19 and at least one the following additional criteria is met:
- The amount of export in 2019 constitutes 10% of the total turnover or is not less than EUR 500 000; or
- The average monthly gross salary paid to its employees during 2019 is not less than EUR 800; or
- Long term investments in fixed assets as on 31 December 2019 are at least EUR 500 000.
The following main conditions should be taken into account:
- The amount of compensation is 75% from the employee’s gross salary for the past 6 months prior to the emergency situation, but not more than EUR 700 per month.
- At the moment the idle time period is determined from 14 March until 14 May but not longer than the emergency situation remains in force.
- Companies are eligible for the compensation only if the turnover for March 2020 has decreased by at least 50% in comparison to March 2019.
- Applications for the idle time compensation should be submitted to the State Revenue Service (SRS) via the electronic declaration system.
- Employer must certify to the SRS that the employee for whom the compensation has been requested will not be terminated within 1 month from the application.
- The compensation is paid directly to the employee’s bank account indicated in the application.
- There are certain exceptions when the compensation is not paid, like failure to submit all tax declarations for the past 12 months, tax debt in excess of EUR 150.
Under the changes in laws, that came into effect on 19 March (with the further amendments), the employer can declare idle time or partial idle time to employees due to the extreme situation and quarantine in Lithuania, when it impossible to organise a remote work and an employee refuses to work in another job position.
Procedure: Idle time is declared unilaterally; it can be applied individually or for a group; it is possible to declare partial idle time by reducing the number of working days per week (no less than by 2 days) or working hours per day (no less than by 3 hours); at least minimum monthly salary (MMS) (EUR 607 gross, EUR 437 net) must be paid for the idle time to the employee. Partial idle time is remunerated proportionally to the time spent on idle time; part of the expenses incurred by employers will be reimbursed by the subsidies from the Employment Service: 60% or 90% from the counted salary, but not more than EUR 607 or EUR 910.5 gross. The subsidy will be paid until the end of the extreme situation and quarantine; the employer undertakes to inform the State Labour Inspectorate about the implementation of idle time within 1 working day (3 working days, if idle time has been declared before 8 April 2020) and keep at least 50% of employees employed for a further 3 months after the subsidy has ended; the employees cannot be required to come to work during idle time.
Note: The applications to the Employment Service for the State subsidy shall be submitted until the 15th day of the following month (for the subsidy for March – until the end of April).
No support measures for employers are introduced by the government.
Regarding related employment issues please contact COBALT Estonia Partner Karina Paatsi, COBALT Latvia Partner Toms Šulmanis, COBALT Lithuania Legal Counsel Dr. Dalia Foigt-Norvaišienė and COBALT Belarus Managing Associate Anastasia Bykowskaya.