Additional detailed rules in connection with the rules of short-time work

The new templates, forms and information sheets adapted to the new rules of the amended ‘Decree on state subsidy to pay the wages and salaries of employees employed in reduced working time ‘ (hereinafter referred to as the Decree), which we shared with you in our previous newsletter, have been made available on the website of the National Employment Agency (hereinafter referred to as NEA) (nfsz.munka.hu) on 29 April 2020.

The joint applications to be filled out by the employer and employee are significantly simplified. In addition, the concerned employee shall fill out a so-called no conflict of interest form, stating that he/she has no conflicting relationship with any person involved in the decision-making process in the Government Office (a list of the concerned persons is available on the website of NEA); furthermore, a so-called involvement statement including the employee’s personal details and the data concerning his/her qualification.

In the joint application, the employer and employee shall declare that they are aware of and accept the Notice that includes the detailed conditions to the state aid and which is available on the website of NEA and that they meet the conditions set in the Decree.

The Notice also includes a definition of the condition that is mentioned, however not defined in the Decree, according to which the keeping the employees is in the interest of the economy at large, related to the continuous operation of the employer.

Pursuant to the Notice, the state subsidy may be granted if the following requirements are met:
a) the employer has not announced collective redundancy affecting at least 100 persons for a one-year period prior to the announcement of the emergency situation;
b) the employer has observed and observes the labour- and work safety rules in the course of its operation, in a one-year period prior to filing the application and during the disbursement of the subsidy.

We note that the Notice fails to give clear instructions on how the fulfillment of these conditions can be credibly certified by the employer (which is also required by the Decree).

As the subsidy may be granted for an economic reason related to the emergency situation, the Notice gives detailed instructions on when the economic reason for ordering work in reduced working time can be considered as being in direct relation with the emergency situation. Pursuant to the Notice, such direct relation may be established if at least one of the following economic circumstances made the working time reduction necessary: (i) loss of market, (ii) stoppage in or termination of the supply chain, (iii) a fallback in the orders, (iv) the occurrence of health risks (COVID) in relation to work, (v) legal provisions adopted as a result of a healthcare emergency.
In this respect, the Notice emphasizes that the grantor of the subsidy, namely the Government Office, is entitled to check whether the application is reasonable.

Among the information sheets disclosed on the website of NEA, there is a so-called calculation table, providing assistance to the calculation of the amount of the subsidy the employer may be eligible to.