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The companies will have virtually no reason to lay off their employees, thanks to the measures

The coordinator of the Expert Advisory Group, Matej Lahovnik, pointed out that the government has made sure that the economy is in very good condition, with the help of all of the effective measures. He said that there were some dilemmas when it came to raising the minimum wage, but they still decided to support this measure, given the current situation. The companies will thus receive a partial subsidy for the increase of the minimum wage, while the companies that have been unable to operate due to the decrees will receive full reimbursements of labour costs.

Following a very long session, the National Assembly adopted the eighth anti-corona legislative package, which, among other things, also extends the validity of the measure of subsidising wages for the employees who have been temporarily laid off until the end of April, and also allocates a subsidy for the first half of the year to all employers for the increase of the minimum wage. The subsidy for the employees who have been temporarily laid off will be valid until the end of April, and after that, the government will be able to extend the measures twice more, for a month each time. The employers who have registered before the end of last year and whose revenues will fall by more than 20 percent because of the epidemic, will be able to benefit from this.

The companies that have to remain closed due to the government decrees will receive compensation from the state for the salaries of their employees, so the so-called second gross. The minimum wage rose to 1024,24 euros gross in January of this year. As the companies are in a difficult situation due to the epidemic, the state will pay them a 50-euro subsidy for the workers with minimum wage, for the first half of this year. And for the second half, the state has offered the exemption from paying the social security contributions. The package worth 320 million euros also received support in the National Assembly, with 51 votes from the SDS, NSi, SMD, DeSUS and SNS MPs, as well as the two representatives of the national communities. It was only the deputies from the Levica, LMŠ and SD parties who voted against, while the other deputies from the opposition abstained from the vote.

“There were actually some dilemmas when it came to subsidising part of the minimum wage,” explained Matej Lahovnik, the Expert Advisory Group Coordinator. He emphasised that in the end, they decided to also support this measure, mainly because, according to current estimates, raising of the minimum wage would lead to an increase in the number of employees being laid off in the current situation. The labour market would not be able to absorb these redundancies and the unemployed would not be able to find new jobs. “Mainly because the service sector is currently either closed or is operating in a very limited capacity.” The situation on the labour market will improve significantly when the measures are lifted, and we will be able to return to normal life.

Compared to the other measures, such as covering the gross gross labour costs, the minimum wage subsidy measure makes a lot of sense. Namely, it can be used by companies in sectors that are closed due to the government decrees. The adoption of this measure makes sense to them, as it means that at least until the end of April, or perhaps even until the end of June if the government decides so and the situation shows that this is necessary, the companies will have the full costs for their employees covered. The companies will, therefore, have virtually no reason to lay off their employees. “Because the state budget will actually bear all the costs,” Lahovnik added.

The purpose of the government measures is to keep unemployment as low as possible
“The purpose of both measures of the government is to keep Slovenia among the Member States of the European Union where unemployment has increased the least,” Lahovnik explained, adding that the data actually shows that we have relatively good economic results. “let me just mention that last year, despite the fact that it was the year of the biggest economic and global crisis since World War II, we had the lowest number of corporate bankruptcies since 2013,” he explains. All of this means that the government anti-crisis measures have been very effective.

Sara Rančigaj

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