COVID-19: Grants for Preserving Employment in Fields of Work Affected by the Coronavirus Pandemic

In order to preserve jobs for employers whose economic activity has been affected by the Coronavirus pandemic, the Government has made a decision on grants per employee for a maximum period of three months from the beginning of March.

The amount of support will be 3,250 per month for full-time employee and HRK 1,625 for part-time employee, or a proportion amount of HRK 3,250.00 or HRK 1,625.00 per month and per employee for time not worked due to decision of the Civil Protection Staff. Grants will be paid by the 15th of the month for the previous month.

Target groups of employers include employers who are providing accommodation and food and beverage; transportation and storage; manufacturing industries (textiles, clothing, footwear, leather, wood and furniture); employers who are unable to perform their activities due to decisions of the Civil Protection Staff (national, county, local self-government units); and other employers who can proof the impact of special circumstances. The grants do not apply to owners, co-owners, founders, members of the management, directors, procurators, etc., except for employers employing up to 10 workers and owners of trades. Based on the public call, employers from eligible sectors will describe the reasons why they seek support for job preservation and support it with evidence and confirm with a signed statement of accuracy of information and reason, which they give under criminal and material responsibility.

Employers from the above stated sectors will need to describe the reasons why they are seeking grant for job preservation and support it with evidence and confirm it with a signed statement of accuracy of information and reason, which they give under criminal and material responsibility.

Some of the acceptable reasons to describe are:

  • decline in traffic;
  • cancellation of reservations, events, congresses, seminars;
  • cancellation of contract work and orders;
  • inability to deliver finished goods or contracted and paid raw materials, machinery, tools;
  • the impossibility of new orders for raw materials, tools and machines necessary for work.

The employer will also need to list the activities he has undertaken for the purpose of preserving jobs, and only one of the reasons given above must be descripted for the grant.

For the purpose of obtaining the right to grant, employers shall submit an application with the appropriate documentation, which is available on the website of the Croatian Employment Fund.

The documentation includes:

  1. Request Form – standardized form available on the Institute’s website or on the website with the attached tables;
  2. Explanation of the fall in income – a tabular comparison of income by the end of the month in which the claim was filed with the same month of the previous year, with a projection of revenue in the following period by three months, comparing the same period of the previous year (acceptable decrease is higher than 20%);
  3. A statement of the accuracy of the information and the reasons for using the grant;
  4. A copy of Decision from the Civil Protection Staff (those employers who do not carry out the activity due to Decision of the Civil Protection Staff);
  5. Evidence of canceled contracts, contracted jobs, problems in the transportation and delivery of goods or the procurement of raw materials.

The request shall be submitted online, by e – mail or to the competent office of the Croatian Employment Fund.

The employer is obliged to:

  • maintain the number of employees determined on the day the Application is submitted, twice as long as the time of using the grant (one month of using the aid – obligation to keep employees employed for 2 months);
  • in case of termination of the contract with an employee, inform the Employment Fund on the reason and exact date of termination within 8 days the latest;
  • repay the grants in full plus the statutory interest rate or a proportionate part of the payments for justified termination of the employment contract, for any person who was not withheld twice as long as the grant has been used;
  • provide evidence of wages paid to workers who are supported by the end of the month for which the grant was paid, containing a list of workers, with the workers‘ handwritten signature and payment date.

The Institute commits itself to:

  • receive and process the user’s request within 10 days of receipt;
  • inform the beneficiary of the approved request and sign the grant agreement;
  • ensure regular disbursement of funds;
  • prior to disbursement of funds, check the status of the workers for whom the grant is paid;
  • check the solvency of the employer before payment;
  • perform regular control of the number of employees during the period of the contractual obligation of double retention.

Employers who are already using the measures of the Croatian Employment Fund cannot use at the same time more than one measure. Therefore, the employers can choose to temporarily suspend contractual obligations under active contracts of Croatian Employment Fund in order to use other measure. After expiration period of use of this other measure, the employers can continue, in the remaining period, to use the measure under active contract of the Croatian Employment Fund which they have put to rest. Such procedure should be regulated with Annex to the contract.

Employers who are granted with support for job preservation may not import employees or recruit others into employment during the period of application of this measure. Employers who have registered a business entity in the past 12 months and who are using self-employment measures cannot benefit from this measure. Employers who experienced a decline in staff from 1 March to 20 March may be granted with support.

An employer may not be granted with support if there has been a decrease in the number of employees in the period from 20 March 2020 until the date of submission of the grant Application and if percentage of employment decline is higher than 40% for employers employing up to 10 workers, higher than 20% for small businesses, higher than 15% for medium-sized businesses and higher than 10% for large businesses.

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