Damaged buildings, properties, roads, and power outages have left many businesses unable to continue operations. During these trying times, it is vital for businesses to be well-informed about the available options and support mechanisms.
In view of the severe damage caused by the floods, the government is already planning measures to reduce the economic burden on businesses. Representatives of the Ministries of Labour, Economy and Finance are working with the Chambers of Commerce and Industry to find short-term solutions. One of their main goals is to quickly introduce subsidies for waiting periods and part-time work, which can provide crucial financial support to companies as they rebuild.
Below is an overview of the measures currently available.
The first institute is temporarily inability to provide work for business reasons. If the employer is unable to perform work for business reasons or, as in this case, due to flooding, employees are placed on standby at home and receive 80% of their wages. This measure is intended to support companies and their employees during times of unexpected disruption, such as natural disasters.
Employees can also be seconded to work from home for office activities that do not require physical presence at the workplace. In this way, employees can work from home when their homes are not affected. This approach can be a good option for companies that want to continue operations under these difficult circumstances.
If certain work is needed to deal with the aftermath of the flooding, employers can also assign other work to their employees that is not covered by that employee’s job description.
Of course, many people at home are also affected by the consequences of the flood. In such cases, force majeure can be invoked. Under the force majeure clause, an employee who is prevented from performing his or her job due to uncontrollable events such as flooding is entitled to half of the wages he or she would have received if he or she had been working, but no less than 70% of the minimum wage.
The company may also pay solidarity contributions to its employees who have suffered damage. According to Article 11 of the Regulation on the Tax Treatment of Reimbursement of Expenses and Other Income from Employment, the payment of solidarity allowances in the event of a natural disaster or fire affecting the employee is tax-free up to an amount of EUR 2,000. The amount in excess of this would be taxable as income from the employment relationship.
Alternatively, the aid could be paid to a humanitarian organisation working in the public interest, as it would be exempt from income tax. This is also strongly recommended by FURS, and a list of humanitarian organisations can be found here. In practise, it is possible to agree with certain organisations that the company will make a donation to a specific person, but this depends on the organisation in question.
We will continue to closely monitor the changes and actions and keep you informed of the support mechanisms available. Our support and solidarity extend to all who are struggling during this challenging time. Together, we can overcome these adversities.
