20th August 2014

Economic Policy: Kurzarbeit to be introduced in the Czech Republic

After its meeting on Monday 18th August Czech government announced that it has agreed with its partners prom business and trade union on the need on introducing so called “kurzarbeit” as a mean on dealing with the impact of sanctions applied on Russia and reciprocally on EU countries. Government announced that it will deal with the precise proposls for kurzarbeit next week when the material from the specially established group would be ready. Kurzarbeit itself could be introduced from 1st January 2015 where employees would receive 90 % of their normal salary but only 60 % will be at the expense of their current employer and additional 30 % would be reimbursed from the government. Various experts for example from PwC, UniCredit or ČSOB agree that properly crafted kurzarbeit proposal would benefit the economy as it is more favourable for the employers than having to pay the costs when they would dismiss temporarily redundant employees and then having to hire and train new ones.

As for the sanctions and their impacts the leader of the workgroup Tomáš Prouza claimed that no employee has so far lost his job because of the sanctions. Regarding the situation on Russian markets Vladimír Dlouhý, president of Czech Chamber of Commerce, said that leaving Russian markets would be a huge mistake as it would prove extremely difficult to return there.

For more click here, here and here.

Members of the American Chamber of Commerce in the Czech Republic