The Government has announced that the possibility of State support to employers when employee reduce their work hours, will be extended to work reductions up to 80%.
An employee who reduces his/her work hours with 80%, will receive 88% of his/her ordinary salary and the employer can receive State support with 78.88% of the ordinary salary cost (excluding social security contributions). Thus, the employer cost (excluding social security contributions) will amount to 21.12% of the ordinary salary.
Taking the social security contributions into account, the employer’s cost will amount to 28% of the ordinary salary cost when the employee reduces his/her work hours with 80%.
When combining the State support with the reduction of social security contributions on salary up to SEK 25,000 per month, the employer cost will be reduced to approximately 16% of the ordinary cost.
As with the State support for work hour reductions at lower levels, State support may only be granted for income up to SEK 44,000 per month.
Please note that State support for work reduction with 80% is limited and may only be granted for salary paid in May, June or July 2020.
The Finance Committee of the Parliament has agreed to reduce the fee for respite with payments of withheld wage tax, social security contributions and VAT, is to be reduced from 0.3% to 0,2% per month. In addition, the fee is not to be levied for the first six months of respite. The Finance Committee is currently preparing an actual proposal. Hence, there is no date set for the change, nor has it been announced whether it will have retroactive effect or not.
The Ministry of Health and Social Affairs has presented a proposal with a possibility for parents who are forced to stay at home when schools are closed due to the Corona virus should be able to receive temporary parental allowance. However, this allowance will be slightly lower than ordinary temporary parental allowance (“VAB”), paid when a parent stays at home tending a sick child. The rules are proposed to enter into force 25 April 2020. The rules are not to have retroactive effect.
If you have any questions or concerns, you are most welcome to contact us for a discussion.