Additional corona support measures for employers - Working time reduction, ‘corona time credit’, ‘corona landing jobs’ and ‘corona unemployment’

In mid-June, the superkern (the parties supporting the minority government) agreed on a set of additional support measures for employers with a view to boosting the economy in the aftermath of the corona crisis. These additional measures are further detailed in Royal Decree n° 46 of 26 June 2020.

Royal Decree n° 46 of 26 June 2020 lays out a range of different support measures. For companies undergoing restructuring or companies in difficulty, three specific measures relating to the reduction of working time have been developed. In addition, the Royal Decree also provides for a transitional period for so-called ‘corona unemployment’.

1. Reduction in working time for companies recognised as undergoing restructuring or in difficulty

The provisions of the Royal Decree provide for a number of specific measures relating to the reduction of working time, which apply to companies recognised as being in restructuring or in difficulty, namely (i) collective reduction of working time, (ii) ‘corona time credit’ and (iii) ‘corona landing jobs’.

The collective reduction of working hours entails a temporary reduction of working hours by 1/4 or 1/5, possibly in combination with a four-day working week and this on the basis of a company collective agreement or an amendment to the labour regulations. This form of collective reduction of working time may be applied for a maximum period of one year during the period in which the company is recognised as undergoing restructuring or in difficulty (until 31 December 2020 at the latest). This measure is accompanied by a certain target group reduction (a flat-rate reduction in social security contributions), which varies according to the type of reduction in working time. However, the employer is obliged to pay a certain amount of wage compensation to the workers concerned. This possibility should provide the employer with an instrument to absorb the reduction of work and to reduce labour costs, without having to carry out dismissals.

In addition, on the basis of this Royal Decree, the employer may propose a form of ‘corona time credit’ to the employees, who will have to agree to this. Such a time credit means that the employee reduces the work performance to a half-time job or by a fifth and will receive a benefit from the National Employment Office for this. The ‘corona time credit’ can be taken up for a minimum of one month and a maximum of six months, which must all fall within the period in which the company is recognised as being in restructuring or in difficulty (no later than 31 December 2020). This period will not be charged on the maximum ‘normal’ reasoned time credit.

Finally, the Royal Decree also introduces the ‘corona landing job’. This means that an employee, who reduces his work performance to a half-time job or by a fifth, is entitled to an interruption benefit from the age of 55, whereas in the ‘normal’ system he is, in most cases, only entitled to this benefit from the age of 57. However, the worker must have a professional history of 25 years and the landing job must start during the period of recognition that the company is undergoing restructuring or is in difficulty (by 31 December 2020 at the latest). By way of derogation from the ‘normal’ landing job system, the minimum period for this ‘corona landing job’ is limited to one month.

The Royal Decree also provides that such recognition as a company under restructuring or in difficulty can be requested without the need to conclude a collective bargaining agreement under the regime of unemployment with company allowance.

The above measures entered into force on 1 July 2020.

2. Transitional system ‘corona unemployment’

The Royal Decree also provides for a transitional system regarding temporary unemployment, which the employer will be able to invoke after the so-called ‘corona unemployment’ period ends on 31 August 2020.

The systems of economic unemployment for blue-collar and white-collar workers will in fact be adapted to allow easier access. More specifically, the Royal Decree provides for a number of derogations from the existing economic unemployment systems.

A different maximum duration of economic unemployment is set for workers. Thus, a complete suspension of the employment contract will be possible for a period of maximum 8 weeks instead of maximum 4 weeks. A partial suspension of the employment contract will be possible for a maximum period of 18 weeks instead of a maximum of 3 months in the case of a ‘major suspension’.

With regard to economic unemployment for white-collar workers, the Royal Decree provides for a number of different conditions and a different maximum duration. By way of derogation from the ‘normal’ rules on economic unemployment for white-collar workers, access to this system will temporarily not be restricted to companies in difficulty. However, the employer must be able to demonstrate that in the quarter preceding the introduction of economic unemployment for white-collar workers he experienced a substantial decrease of at least 10% in turnover or production compared to the same quarter of 2019. Moreover, he must offer two training days per month to white-collar workers who are in economic unemployment.

The requirement of the existence of a collective agreement or business plan providing for the payment of a supplement on top of the temporary unemployment benefit is maintained. The business plan must also be forwarded without delay to the works council or, failing that, to the trade union delegation. It will not, however, be necessary to transfer the business plan to the FPS ELSD, nor will it have to be submitted to the Business Plans Committee for approval.

The maximum number of weeks during which white-collar workers can be placed in economic unemployment will be temporarily increased by eight weeks under this transitional system. In concrete terms, this means that a complete suspension will be possible for a maximum of 24 weeks (i.e., 16 weeks + 8 weeks) and a partial suspension for a maximum of 34 weeks (i.e., 26 weeks + 8 weeks).

This transitional period will enter into force on 1 September 2020 and will apply until 31 December 2020.

Action point

Check if your company, whether or not recognised as being in restructuring or in difficulty, wishes to rely upon one of the various measures.