The recently approved major amendment to the Labour Code brought a number of new aspects to labour law relationships (for more details see our newsflash). We would also like to let you know about some other changes you should be sure to note.
1. Meal voucher flat rate
The Chamber of Deputies approved the tax package in the first reading (meaning that the legislative process is far from over) including an expansion of the options for this popular employee benefit.
The amendment to the Income Tax Act anticipates other options for the employer to provide employees with a contribution to meal costs. At the present time the employer can contribute either in the form of meal vouchers or a company canteen. Any other contribution to meal costs paid to the employee in monetary form is possible, but has no tax advantages (i.e. is not a tax-deductible expense).
If the amendment is passed, employers will be able to provide their employees with a contribution to meal costs in the form of a cash allowance. This cash allowance will be treated as a tax-deductible expense; the allowance will not be subject to tax or withholdings for health insurance and social security.
The amendment makes no change to the existing options for the contribution in the form of meal vouchers and company canteen. The employer decides on the form of the benefit.
2. Extending and expanding the Antivirus programme
We would like to point out that employers can still request support under the Antivirus programme, wherein the state covers part of the wage compensation for employers economically affected by the COVID-19 pandemic.
Modes A and B have both been extended to August 31, 2020. The form of the support in the autumn is still under discussion. It is possible that further state aid will be provided in accordance with Section 115 of the Act on Employment. Among other things, this could mean that acquiring financial aid from the state would require meeting three important conditions:
a) the employer pays employees at least 70 % of wage compensation for the time they were not working due to partial unemployment,
b) the employer cannot assign the employee work of at least 20 % of the standard weekly working hours,
c) the employer agrees in the agreement on providing the contribution with the Labour Office that the employer will not terminate the employee’s employment for reasons set forth in Section 52(a) through (c) of the Labour Code during the period agreed for providing the contribution for that employee.
However, as of the date of releasing this NewsAlert nothing has been decided, so we will have to wait to see what happens!
As we reported in our newsflash in June 2020, a new Mode C has been introduced for the Antivirus programme under which certain employers can request a waiver of the insurance premiums paid for the employer for social security and state employment policy contribution for the months of June, July and August 2020.
3. Other selected changes under the major amendment to the Labour Code and related regulations
Several changes will take effect as of January 1, 2021 in the area of compensation for damage and non-pecuniary harm for the next of kin of an employee who died as a result of an occupational injury or disease.
The amount for compensation of the appropriate costs associated with the funeral will no longer be stipulated as a fixed amount, but instead will be derived from 1.5 times the average wages on the national economy.
The list of next of kin who can become entitled to one-off compensation for non-pecuniary harm will also expand to include the spouse or partner, child (whether dependent or not) and parents (whether the deceased employee lived in the same household or not) of the deceased employee. Other family members or persons in a similar relationship who feel harm to the employee as harm to themselves are also entitled to one-off compensation. If both parents
become entitled to the compensation, each of them receives one half of the amount.
The amendment is intended for those affected by the employee’s death even though they may not live in the same household or may not be the employee’s minor (dependent) children, as was the case previously.
The one-off compensation will no longer be set as a fixed amount. It will now be derived from the average wages on the national economy and will equal at least 20 times that amount.
A new institute in the Labour Code as of January 1, 2020 is the one-off compensation for non-pecuniary harm in the case of particularly serious harm to the employee’s health. This compensation will be paid to the same group as in the case of the employee’s death.
As of July 30, 2020 the compensation for lost earnings after incapacity to work (sick leave) comes to an end will be calculated for an employee listed as a job seeker. Compensation in the amount to which the employee is entitled during the employment relationship (or non-employment work agreements) will now only be provided for the period in which the
unemployed person is registered in the list of job seekers. After registration in this list is over, compensation will be paid in the amount of the difference between the person’s average earnings before the damage occurred and their current earnings in their new employment (after the occupational injury or disease).
One other practical change for employers is that they will no longer be required to give the employee a confirmation of employment when the labour law relationship based on an agreement for work (DPP) comes to an end, with the exception of a DPP that established participation in sickness insurance and a DPP where the remuneration is subject to
enforcement of a decision or distraint by wage deductions. This change takes effect as of July 30, 2020.