27.03.2020: The State measures for the business and the scheme 60:40

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On 25 March 2020, the Government determined that more than BGN 2 billion would be allocated from the budget for economic measures:

  • The Prime Minister has announced that over 60% of the employee’s remuneration in the affected sector will be covered by BGN 1 billion state funding.
  • The capital of the Bulgarian Development Bank (BDB) will be increased by BGN 500 million to guarantee loans, taken by companies from private banks.
  • BGN 200 million from BDB through commercial banks will be given for unsecured consumer loans up to BGN 1500 for employees who are on unpaid leave but with reserved jobs.
  • BGN 500 million – for remunerations of health officials, police and military.

Employers, in order to benefit from the 60:40 scheme, in which the state supports them with most of their workers’ remuneration, should:

  • be local natural or legal persons, as well as foreign legal entities operating in Bulgaria;
  • claim compensation of employees in the stated 19 sectors and economic activities
  • have no tax obligations and mandatory social security contributions within the meaning of Art. 162, para. 2, item 1 of the Tax and Social Insurance Procedure Code;
  • have not been declared bankrupt or are not in bankruptcy or liquidation proceedings;
  • keep the employment of the persons for whom they have been compensated for a period not less than the period for which the compensations have been paid;
  • not terminate the employment agreements of the employees due to the closure of the enterprise or part of it, redundancies, reduction of work, or suspension of work for more than 15 days during the period for which they are compensated;
  • not to have a violation of the labor llegislation established by a penal decree or court decision.

Applications will be submitted by employers to the state employment offices. The following documents should be attached to them:

  • an order by the employer to discontinue work under Art. 120c of the Labor Code (due to the state of emergency);
  • a declaration that they will maintain employment in the enterprise and that they will not terminate employee’s agreement during the period during which compensation is paid;
  • a list of workers for whom compensation is being applied for;
  • a declaration with employer’s bank account with IBAN.

There will be a templates for all of the declarations, which will be approved by the Executive Director of the Employment Agency. And the offices will notify the employer of its decision within 2 working days from the date of its making.

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