New amendments with respect to the Kurzarbeit program

On April 5th, 2021, there was published with the Romanian Official Gazette, Part I, no. 345, the Law no. 58/2021 for the approval of the Government Emergency Ordinance no. 211/2020 (the "Kurzarbeit Law").

Among the most relevant amendments regulated under the Kurzarbeit Law, we would mention the following:

• during the state of emergency (in Romanian: "stare de urgenta/ alerta/ asediu"), as well as for a period of up to 3 months from the end of the last period during which the state of emergency (in Romanian: "stare de urgenta/ alerta/ asediu") was in force, employers are able to reduce the working time of employees by up to 80% of the daily, weekly or monthly normal working hours (instead of 50%, as in the previous version) as provided in the individual employment agreement (the "Measure");
• to enable implementation of the Measure, the employer needs the agreement of the trade union entitled to negotiate the collective bargaining agreement at the company level or, if it does not exist, the agreement of the employees' representatives.
• the Measure is established by the employer's decision; the minimum period of 5 working days for which the measure is to be applied shall be determined by reference to a period of 30 calendar days, starting from the first day of effective application of the measure, and not by reference to 5 working days per month (as in the previous version);
• the employer's decision to reduce working time may be communicated to the employee on 5 days’ notice; by way of exception, as a new provision, the notice can be communicated at least 24 hours before the intended application of the Measure, in the event of:

a) a change in the work schedule due to an increase of the activity of the employer, which thus requires additional staff or

b) in case of replacement of an employee who is unable to perform his/her duties according to his/her work schedule;

• the indemnity related to the Measure: during the reduction of working time, the employees affected by the Measure benefit from an indemnity of 75% of the gross monthly salary related to the hours of reduction of the working schedule. As a new provision, if the employer's budget for the payment of staff costs allows, this indemnity may be supplemented by the employer with amounts representing the difference up to the level of the basic salary corresponding to the related position, without this difference being settled by the State;
• as an exception, it is permitted to hire in order to replace employees whose working time has been reduced if the termination of the individual employment agreement takes place:

a) lawfully;

b) for reasons related to the conduct of the employee;

c) by the resignation of the employee;

• the employer may implement the Measure and may request the settlement of the related indemnity, if the following conditions are cumulatively met:

a) the Measure affects at least 10% of the company's number of employees;

b) the reduction of the activity is justified by a decrease of the turnover from the month prior to the application of the Measure or, at most, from the month before the previous month, by at least 10% compared to the similar month or compared to the monthly average turnover from the year prior to the decree of the state of emergency (in Romanian: "stare de urgenta/alerta/asediu") i.e. in 2019;

• in order to settle the amounts related to the indemnity, the employer must submit an application accompanied by,  amongst others, the following documents:

a) a copy of the decision on the reduction of working time and proof of its notification to employees, by any means commonly used by the employer to communicate with employees;

b) an affidavit executed by the employer;

c) copy of the agreement executed with the trade union / employees 'representatives or, as the case may be, proof of informing the employees (where there is no trade union entitled to negotiate the collective bargaining agreement at company level or employees' representatives);

Within 30 days of the entry into force of Kurzarbeit Law (i.e. 30 days from 8th April, 2021) the Government will have to update the procedure for settlement and payment by the State of the amounts related to the Kurzarbeit program.