Such a mechanism could replace downtime compensation, which will expire on Tuesday, June 30.
The LDDK stresses that Latvia currently has one of the fastest rates of unemployment growth in the European Union, which shows that many companies are unable to save jobs in times of crisis, while downtime benefits will cease to be paid on Tuesday.
The next possible aid instrument for companies is wage subsidies for exporting companies, but the regulatory framework has not yet been developed.
The Director General of the LDDK, Liga Meņģelsone, said that the first phase of the crisis, during which many companies experienced a sharp drop in turnover, is over and it is important to provide a helping hand in the second phase.
The main benefit of the shortened working time scheme for entrepreneurs, workers and society as a whole is the sense of safety and flexibility, both for the employer and for the worker. In particular, at a time when the company understands that the market situation is changing and it is no longer able to employ people full-time, employees should not be dismissed, but work shorter hours. For society, the benefits are steadier unemployment rates and continued consumption.
The new scheme is still being discussed. Sectors have not been identified yet but it is forecast that it would most likely be producers, tourism sector and service providers. Negotiations are ongoing with the social partners and ministries. A clear signal of support has not yet been received from the ministries.
Research is also ongoing. Experience can be drawn from other European countries whose legislation has already been incorporated into such a system during the previous crisis and has proven to be successful.
