With good reason, the Directorate of Labour would like to inform you of the following:

There has been some discussion in the media over the past few days about the interpretation of the interim provision adopted into the Unemployment Benefit Act as regards partial unemployment benefits due to reduced employment ratio.  This provides for authorisation for employers and employees to enter into a temporary agreement on a reduced employment ratio.  The employee can then apply for and receive support corresponding to the reduced employment ratio from the Unemployment Insurance Fund.

The main purpose of the provision is to assist and make it possible for employers and their employees to maintain their employment relationship during the difficulties that we now face.

The Directorate of Labour wishes to reiterate that a prerequisite for the payment of the support to the employee is that the employment contract remains in effect.  If an employer terminates the employment contract of an employee with whom he has reached an agreement, the Directorate is of the opinion that the conditions for the agreement are not fulfilled in which case the general rules on termination of employment come into effect.

If employers have misunderstood the above rule and terminated the employment of employees with whom they have reached an agreement for a reduced employment ratio, the Directorate of Labour urges them to withdraw such terminations.