19th August 2021

Kurzarbeit finally given green light after one year

An amendment to the Act on Employment, promulgated in the Collection of Laws under no. 248/2021 and introducing the kurzarbeit scheme or a contribution during partial employment, has been in effect since 1 July. The contribution is determined by government whenever the Czech economy or some of its sectors are seriously threatened. Reasons for the provision of this type of support include an epidemic outbreak, natural disasters, cyberattacks, or any other extraordinary situations resulting from force majeure events.  

Similarly as in the case of Antivirus, employers specified in Section 109(3) of the Labour Code, i.e. the state or institutions receiving contributions from the state budget, may not apply for this type of support. Contributions will also not be provided in respect of employees for whom a working time account was used.

Similarly as with Antivirus, kurzarbeit should support employment in emergency situations when employers have to partly curtail their operations and employees cannot perform work due to an impediment to work on the employer’s part. Impediments to work include downtimes or work interruptions caused by adverse weather conditions, other impediments on the employer’s part or partial unemployment, and must occur in direct connection with some of the grounds for providing the contribution.

Based on a notification filed with a relevant labour office, employers shall receive a contribution per each employee whose employment lasted at least three months at the date of filing the notification. Notifications shall be filed electronically. The contribution shall amount to up to 80% of expenses per employee (i.e. wages and mandatory charges) if both of the following conditions are met:

  • At the time of impediments to work, employees are paid wage compensation equal to at least 80% of their average earnings.
  • The employer cannot assign work to employees amounting to a minimum of 20% to a maximum of 80% of their weekly working hours due to the impediments to work. This condition is evaluated on an aggregate basis for all employees.

The monthly contribution amount is limited to a maximum of 1.5 times the average wage in the national economy in the relevant period and is paid out over a maximum period of twelve months.

Similarly as with Antivirus, employers shall submit monthly overviews of employee wage compensation expenses, i.e. monthly statements, electronically to the relevant labour office no later than on the 20th day of the calendar month following the month for which the contribution is to be granted. If the monthly statement is properly filed, the office shall pay out the contribution within eight calendar days of the date the statement was delivered.

The kurzarbeit scheme was finally given the green light. We will just have to wait and see whether it will meet all expectations and contribute to an overall economic benefit.  

Romana Szuťányi rszutanyi@kpmg.cz +420 703 873 693


Members of the American Chamber of Commerce in the Czech Republic