The 60/40 Measure  Is Amended and Prolonged Until 31 July 2021

Decree No. 213/ 01.07.2021 for amendment and supplementation of Decree No. 151/ 03.07.2020 of the Councils of Ministers Defining the Requirements and Procedure for Payment of Funds for Preservation of Employment after the Period of the State of Emergency and the Extraordinary Epidemic Situation was promulgated in State Gazette, issue 56 dated 6 July 2021. The 60/40 measure has been prolonged with another two months – from 1 June 2021 until 31 July 2021. The requirement for the measures towards the personnel – suspension of work, establishment of part-time working time, granting of annual paid leave by the employer without the employee’s consent, to be implemented within the period between 13 March and 31 December 2020. A number of amendments were also introduced.

I. New Amounts for the Funds for Preservation of Employment and Amendment in the Requirements concerning the Amount of the Decrease in Revenue.

The amount of the due funds for preservation of employment has been amended and is now dependent on the decrease in revenue declared by the employer. Employers will be entitled to receive funds under Decree No. 151 / 03.07.2021 for the period June - July 2021 in the amount of 50 percent of the amount of social security income for April 2021 and of the due insurance contributions for the account to the employer of each employee, if they have declared a decrease in revenue as follows:

• for the entities established before 1 June 2019 – with no less than 30 per cent during the month for which the application for payment of funds is made, as opposed to the corresponding month of 2019;
• for the entities established after 1 June 2019 – with no less than 30 per cent during the month for which the application for payment of funds is made, as opposed to the average monthly revenue for 2020.

In order to receive funds for preservation of employment, the employers must declare decrease of average monthly revenue from sales for 2020 as opposed to 2019.

The funds will be at the amount of 60 percent of the amount of social security income for April 2021 and of the due social security contributions for the account to the employer of each employee, if the employer has declared a decrease in revenue as follows:

• for the entities established before 1 June 2019 – with no less than 40 per cent during the month for which the application for payment of funds is made, as opposed to the corresponding month of 2019;
• for the entities established after 1 June 2019 – with no less than 40 per cent during the month for which the application for payment of funds is made, as opposed to the average monthly revenue for 2020.

When the employer receives financing for the same expenses from European Structural and Investment Funds or from the state budget as compensation of services assigned by the state, the total amount of the funds granted shall be up to 80 per cent of the social security income for April 2021 and of the due social security contributions for the account of the employer.

II. The Social Security Income for April 2021 Shall Be Used for Reference

The Social security income as per which the amount of the funds under the measure shall be calculated, shall be for April 2021.

The social security income for April 2021 shall be calculated for the persons who have worked during the period as the daily average social security income is multiplied by the number of working days for April 2021. For the persons who have used for the whole month a paid leave for temporary incapability to work, pregnancy and childbirth or due to adoption of child of up to 5 years of age – the daily average social security income from which the compensation is made shall be multiplied with the number of working days for April 2021.

Employers who have received funds for preservation of employment under the Decree No. 151/ 2020 shall pay remuneration to the employees at an amount not less than the amount of the social security income for April 2021, and shall pay the due social security contributions for the respective month.

III. Other

The employers may apply for funds for preservation of employment only for employees with whom they have been in an employment relationship before 1 January 2021.

The applications for payment of funds for preservation of employment under Decree No. 151/ 03.07.2021 for the period June-July 2021 shall be submitted no later than the month following the month for which the application is made.

The requirement for monthly reporting of the employers who have already been approved for payment of funds for preservation of employment under Decree No. 151/ 03.07.2020, is repealed for the period of June-July 2021. Separate applications must be submitted for each month of the new period.

The amendments introduced by Decree No. 213/ 01.07.2021  shall enter into force on 1 June 2021, but funds for the period between 1 June 2021 and 31 July 2021 shall be paid after receiving of a positive decision by the European Commission for the compatibility of the aid with the internal market. The applications for payment of funds for the period between 1 April 2021 until 31 May 2021, which have been submitted before 15 June 2021 shall be reviewed and financed under the old regime.

This material is not exhaustive, is only of general nature and does not represent a specific advice or consultation. Should any additional questions arise, please do not hesitate to contact us at tel.: 02/943 37 00, fax: 02/943 37 07, е-mail: office@afa.bg or at: 38, Oborishte Str., Sofia 1504.