PRAGUE (Reuters) – A new law that would partially subsidise salaries of employees on reduced work schedules, a version of the German “Kurzarbeit” scheme, should take effect ideally in November to replace an expiring job furlough scheme adopted early in the coronavirus pandemic, Prime Minister Andrej Babis said on Monday.
Industry and Trade Minister Karel Havlicek said the law would allow the government cover 50-70% of pay for 1, 2, or up to 4 days per week that employees are at home due to shocks to companies coming from pandemics or natural disasters.
Employers would have to cover health and social insurance for the days when workers are at home, Havlicek said, and employees would contribute by the partial reduction in their pay. The government aims to finalise the law on Wednesday and send it to parliament.
The current furlough scheme has kept unemployment low throughout the pandemic and has proven to be one of the government’s most effective crisis measures. Economists have warned that may jobs would be lost when the scheme expires.
(Reporting by Jan Lopatka)