Short Time Work Measures Across Europe
27 Mar 2020
Throughout Europe trade unions are negotiating short time work schemes with both employers and governments so that workers are not let go during the COVID-19 lockdown but instead continue to receive their wages or a percentage of their wages.
Short time work schemes are essential, they support workers and businesses to cooperate during and live through the lockdown period without the fear of unemployment or being unable to meet their bills.
Decisions that are made now will determine if the EU can avoid the COVID-19 crisis becoming a great recession and unemployment crisis. The EU and Member States need to work with unions and employers to develop policies and, importantly, to mobilise resources that will keep businesses afloat and protect as many jobs and livelihoods as we can. This means adopting policies and financial packages that keep the real economy, businesses, including small business afloat in a way that guarantees they can pay their staff and wait out the coronavirus crisis without making workers unemployed.
Maintaining workers in employment is essential. Policy makers often fail to understand that companies that close down in a crisis don’t always open up again and even when they do the tendency is to take on different workers, often on more fragile contracts with worse pay, terms and conditions. In addition, for the workers concerned being unemployed and applying for benefits is entirely different situation both economically and psychologically than remaining in employment even though their wages may be partly reduced.
Trade unions have concluded a number of far-reaching agreements that achieve the triple objective of protecting business, maintaining employment and ensuring that when we come out of lockdown we are in the best position to restart our economies and societies. There are different types of short-time work schemes and there are numerous arguments in favour:
(1) Short time work schemes reduce dismissals in a situation of crisis.
(2) Short time work schemes mean that employees retain employment and income which helps them to broadly keep up their standard of living - provided that benefits cover a sufficient percentage of their wages.
(3) From a macro-economic perspective Short time work schemes help to stabilize the economy because workers retain and are able to spend a large part of their wages
(4) the state saves money because usually it is less expensive to pay Short time Work Schemes support than to pay unemployment benefits for the workers who otherwise would have been made redundant.
(5) Short time work schemes help employers to retain their workers who are readily available when the economy recovers; employers therefore save a lot of costs in hiring people when the economy recovers.
(6) Short time work helps employers to adjust working hours to actual demand in situation of cyclical fluctuations.
The table below* provides you with an overview of short time work measures adopted during the current COVID-19 crisis. The table not only includes information on crisis-related measures but also basic information on how STW schemes work in the EU countries which we hope helps to better understand the current crisis-related measures. One note of caution, the table captures a dynamic situation which is subject to ongoing change. We therefore kindly ask the affiliates to provide us with further information on crisis-related measures that have been introduced in your country so that we can update the table.